No matter how old or young you are, and no matter how much wealth you have, estate planning is something that should be on your radar. Obviously, your circumstances will determine the extent to which you need to plan for your passing, but the unexpected can always happen, and it’s good to have a solid plan for your assets in place when it does. Remember, the biggest estate planning mistake is not having an estate plan at all.
Here are a few other common mistakes:
Not Taking Advantage of a Life Insurance Trust
Life insurance trusts are something that people overlook all too often. It’s to the financial detriment of the beneficiaries of their life insurance policies. If not protected by a trust, a life insurance policy can become subject to onerous estate taxes when it is paid out. Make sure that you consult a qualified estate planning attorney who can help you set up a life insurance trust that ensures your life insurance policy is able to pay out as much as possible to the people who will need it.
Not Keeping Your Will Current
At least every year or so, you should take the time to review the last will and testament you have in place. Things change all the time, and you want your will to reflect any changes that have taken place in your life and family. This can include adding or subtracting beneficiaries, as well as adjusting how assets are divvied out based upon changes to your own financial situation. The last thing you should want for your beneficiaries is to leave behind an outdated will that has the potential to create contention and disagreements following your demise.
Not Having a Living Will
Anything can and will happen in this life, and sometimes our exit from the world is not what we would have planned. If you find yourself terminally injured and in need of life-sustaining care, then having a living will is crucial. This legal document defines what kinds of life-sustaining treatment you’re open to receiving and when it is appropriate to pull the plug. Also, this living will should grant someone with healthcare power of attorney or general power of attorney. This is necessary in the event that you are incapacitated and need someone to make important medical decisions for you. If you have a designated general power of attorney, they can also make important financial, business, and personal decisions.
Picking a Poor Executor
Most often, people will name an immediate relative as the executor of their estate. While it seems an obvious decision to make, it requires some thought. Can you confidently say that the person you’ve chosen will act ethically and expeditiously on your behalf? If not, then it could make sense to select an executor for your estate who is not directly affected by it. In some cases, individuals elect to have an estate planning lawyer act as the executor of their estates, knowing that these individuals will be able to objectively handle any confusion or disagreements surrounding the will’s terms.
Not Making a Plan at All
Of all the mistakes you can possibly make, the biggest one is not creating an estate plan at all. Start by retaining the services of an experienced estate planning attorney at Clear Counsel Law Group. If you’re serious about securing your family’s wealth, make sure that you get in touch with our office today!