The Six Biggest Estate Planning Mistakes

What are the biggest estate planning mistakes? Putting together a long-term plan for your family can be overwhelming and challenging to navigate. There are a handful of common estate planning mistakes that you can avoid when making important decisions for your family.

1) Failing to Plan

The biggest mistake is failing to create a plan in the first place. Without an estate plan, your assets will be distributed according to the law in the state where you live. Typically, your spouse is entitled to a portion of your estate and the rest will be divided among other relatives. If you were single, your estate would be distributed among children, if you had any, your parents, or siblings. If you had no living relatives, the state would take your hard-earned assets.

2) Doing It Yourself

It is tempting to try to save money, but do-it-yourself estate plans could wind up costing your estate more than you saved. And, after you’re gone, who will make sure your assets wind up in the right place?

3) Not Planning for Disability

A properly drafted estate plan not only details what will happen to your assets after you die, it plans for your disability. It is important to have documents such as a power of attorney and health care proxy that designate someone you trust to act for you if you can’t do things yourself.

4) Failing to Fund a Trust

If your estate plan includes a trust, you will need to fund the trust and retitle assets.

5) Not Checking Your Beneficiary Designations

Beneficiaries die too. Or they grow up or become people you don’t want to leave money to. Retirement accounts and insurance policies will abide by the forms you left on file. Check them periodically to make sure the beneficiaries are still valid.

6) Not Updating the Plan

Once you have an estate plan, it’s important to keep it current. Circumstances change over time and your estate plan should keep up with those changes. For example, marriages, divorces, children and economics can all affect your estate plan. Pick a day of the year to review your estate plan. You should also review it after any major life changes.

Avoid These Mistakes

An experienced estate planning attorney can assist you with avoiding these common mistakes. Contact us to get in touch with our estate planning attorneys to get started.

 

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