Common Estate Planning Mistakes
As an estate planning attorney can explain, there are some people who have very well thought out estate plans, and others who unfortunately have estate plans that fail to carry out the person’s goals and could end up costing their heirs thousands of dollars in otherwise unnecessary legal fees and court costs. In this article, our friends from The Siegel Law Firm, P.A. have highlighted some of the most common estate planning mistakes.
Relying on a Last Will and Testament
The first common mistake is relying solely on a Last Will and Testament (“Will”) to devise assets to beneficiaries. It is a common occurrence for an individual to draft a Will online or get the basic “Will package” from an attorney which sets forth who will inherit the person’s assets upon their death. A Will is an important tool in estate planning but ending your work after signing a Will is a big mistake. A Will alone will not avoid the probate process. In addition to a Will, it is vitally important to also name beneficiaries on your bank, brokerage, and retirement accounts as well as look at options to avoid probate on your real property like a life estate deed or deeding the property into a Trust.
Failing to Designate Successor Beneficiaries and Agents
A Will and Advanced Directives (i.e. Power of Attorney, Health Care Directive) should have a backup beneficiary and agent in case the primary person cannot act or predeceases the maker of the documents. If a backup beneficiary is not named then your assets will likely go pursuant to State law and not according to your wishes. Advanced Directives should also have backups in case the primary agent cannot act for the creator of the document.
Failing to Update Your Documents after Moving to a New State
In the event you move to a new State it is important to have a local attorney review your out of State documents. Although an out of State Will should be recognized in your new State it is still important to update your documents as the laws may differ in your new area. For example, in many States an executor/personal representative must be a blood relative or a resident of that State. If you named a close friend that resides in your last place of residence that person may not qualify in your new State.
Estate planning mistakes can be costly and cause added stress in an already difficult time. It is important to hire an experienced estate planning attorney to avoid mistakes that can cause your beneficiaries stress, time, and money.