Estate planning is necessary to ensure that your assets are protected and your last wishes are honored after you are gone. It is not a joyous thing to plan, but it’s extremely important for the sake of the generations that succeed you.
Given the weight of its importance, estate planning is rarely easy. There are a lot of mistakes that can negatively affect the assets that you leave behind and cause unnecessary stress for your loved ones in their time of grief. In this article, we will be talking about some of the most common estate planning mistakes that can cost you a lot.
Not having a lawyer
A reliable lawyer will draft your estate planning documents, help you figure out taxes, and assist you in sorting out complicated financial situations, among many other tasks. Most importantly, having a lawyer to guide you through estate planning ensures that the documents you leave behind are legally valid, as opposed to doing everything yourself. The money you save by doing DIY estate planning is extremely insignificant to the potential losses your loved ones may face after you die without proper estate planning.
Waiting too long
Death is unpredictable. Even if you are young and healthy now, you should plan your estate if you want to make sure that your assets go to the people you want them to (even if those assets are not much). Without a will, your family’s future may be put at risk; not just with money, but with guardianship for your children as well. And even if you are not leaving dependents behind, your assets may be distributed in a way that does not reflect your intent.
Not securing estate planning documents
Keep all important estate planning documents, especially your will, in a secure place such as a safety deposit box or vault. Make extra copies for your designated executor as well as your attorney. Failure to secure important documents will render your estate planning efforts useless. Not only that, but it will cause unnecessary stress for the people you leave behind.
Failure to update wills and forms
Making a will is not a one and done deal. Estate planning documents must be updated every time there is a change in family status, including birth, death, marriage, relocation, and divorce. Moreover, you should review your estate planning documents at least every couple of years to see if you want to make any revisions.
Keeping secrets from beneficiaries
If you think that your will is going to cause conflict among your beneficiaries after you pass, keeping secrets is not going to make it any better. Try to resolve the conflict while you are still in this world. If that is not possible, let your beneficiaries know about which people you are leaving bequests to (and explain why, if you wish).
Needless to say, this is not always easy to do, especially if hostilities are rampant, but it is better to set expectations before you die rather than causing tedious and costly delays after you are gone.
Appointing an unqualified executor
The executor and trustee that you name in your will should be more than just a person you trust; they should also be able to handle your trust, as well as the conflict that may arise along the way. So even if you fully trust the person that you want to designate as your executor, assess if they are equipped with the skills (and emotional capabilities) to handle your estate after you pass. This is especially true if you are leaving behind minor children whose future will largely depend on the actions of your trustee.
With all that said, these costly estate planning mistakes are avoidable, even more so with the help of an experienced estate planning lawyer.
Meta Title: Costly Estate Planning Mistakes and How to Avoid Them
Meta Description: Planning for the future of your loved ones should be a priority while you’re still young. Learn about the most common estate planning mistakes that can cost you more than you think.