
Whether you’re creating your first estate plan or reviewing an existing one, avoiding these key mistakes is essential to ensure that your assets are protected and your loved ones are taken care of. Let’s dive into the most common mistakes people make and how working with an estate planning attorney can help you avoid them.
1. Not Having an Estate Plan at All
The biggest mistake you can make is simply not having an estate plan. Many people think they don’t need one, but failing to plan means that if something happens to you—whether you pass away or become incapacitated—your family is left in a tough spot. Without a clear plan, the courts will decide how your assets are distributed, which can be a lengthy and costly process for your loved ones.
An estate plan gives you control over your assets and ensures your wishes are followed. It also spares your family from unnecessary legal battles and emotional stress during difficult times.
Avoid This Mistake: Work with an estate planning attorney to create a personalized plan that covers all aspects of your estate, including your assets, beneficiaries, and any specific wishes you have.
2. Failing to Update Your Estate Plan Regularly
Creating an estate plan is not a "set it and forget it" task. Life changes happen, and your estate plan should reflect those changes. Unfortunately, many people fail to update their documents after significant life events, leaving outdated information that can cause confusion and disputes.
Consider these scenarios:
A beneficiary has passed away.
You’ve gone through a divorce, but your ex-spouse is still listed as a beneficiary.
Your executor is someone you no longer trust.
If your estate plan doesn’t reflect your current life situation, it could cause unnecessary complications for your family.
Avoid This Mistake: Update your estate plan every three to five years or whenever a major life event occurs, such as marriage, divorce, the birth of a child, or acquiring new assets.
3. Not Clearly Naming Beneficiaries and Contingent Beneficiaries
One of the most common mistakes people make is failing to list specific beneficiaries in their estate plan. Some people simply refer to a group or class of people, like “my children” or “my siblings.” However, this can lead to confusion and disputes over who exactly belongs in that group.
Additionally, not naming contingent beneficiaries is another common oversight. A contingent beneficiary is a backup person who inherits if your primary beneficiary is unable to do so.
Avoid This Mistake: Work with an estate planning attorney to clearly list primary and contingent beneficiaries by name to avoid any confusion or legal disputes.
4. Not Naming an Executor for Your Estate
Your estate plan should include the name of the person who will manage your affairs after you pass away—this person is called the executor. If you don’t name an executor, the courts will choose someone for you, which may not align with your wishes.
Choosing the right executor is important because this person will handle:
Distributing assets
Paying debts and taxes
Managing legal matters
Avoid This Mistake:Select a trusted individual to serve as your executor and name a backup in case your first choice is unable or unwilling to serve.
5. Ignoring Digital Assets in Your Estate Plan
In today’s digital age, many people forget to account for their digital assets, such as:
Social media accounts
Email accounts
Online banking and investment accounts
Cryptocurrency
Without a plan for these assets, your family may struggle to access or manage them after your passing.
Avoid This Mistake: Include instructions for handling your digital assets in your estate plan. An estate planning attorney can help ensure your digital presence is properly managed.
6. Not Planning for Incapacity
Estate planning isn’t just about what happens when you die. It’s also about what happens if you become incapacitated and can no longer manage your affairs. Many people overlook this crucial aspect of estate planning.
You need documents in place to:
Designate someone to manage your finances
Make healthcare decisions on your behalf
Outline your wishes for medical treatment
Avoid This Mistake: Include a power of attorney and advance healthcare directive in your estate plan to ensure your wishes are followed if you become incapacitated.
7. Overlooking Tax Implications
As your wealth grows, you may move into different tax brackets, which can impact how your estate is taxed. Many people don’t account for these changes, potentially leaving their loved ones with a hefty tax bill.
Avoid This Mistake: Work with an estate planning attorney to ensure your estate plan takes advantage of available tax benefits and minimizes the tax burden on your beneficiaries.
8. Using DIY Estate Planning Templates
The rise of do-it-yourself (DIY) estate planning tools has made it easier than ever to create an estate plan, but these templates often leave out critical legal language. If your documents aren’t drafted correctly, your estate plan could be challenged in court.
Common issues with DIY estate plans:
Missing key legal terms
Lack of state-specific legal requirements
Incomplete or unclear instructions
Avoid This Mistake: Hire a professional estate planning attorney to draft your estate plan to ensure it’s legally sound and customized to your needs.
9. Not Planning for New Assets
Life changes, and so does your financial situation. As you acquire new assets—like property, investments, or business interests—it’s important to update your estate plan accordingly.
Avoid This Mistake: Review your estate plan regularly to ensure all new assets are accounted for and distributed according to your wishes.
Protect Your Family’s Future with an Estate Planning Attorney
Avoiding these common estate planning mistakes can save your family from unnecessary stress, legal battles, and financial strain. The best way to ensure your estate plan is comprehensive and legally sound is to work with an experienced estate planning attorney.
Here at the Law Office of Briana C. Robertson, we’re passionate about helping families protect their generational wealth and avoid costly mistakes. Let us help you create a plan that keeps your assets out of the courts and in the hands of your loved ones.
Schedule a consultation today to start your estate planning journey. Together, we can ensure that your wishes are honored, your assets are protected, and your family’s future is secure.
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