3 Easily Avoidable Estate Planning Mistakes
Estate planning is not a topic that many like to think about. After all, planning for our death can be a morbid way to pass the time. But, instead of thinking about the negative, it is important to remember the positive attributes of estate planning – namely, the security and future well-being of your family and loved ones.
Many are intimidated by estate planning, assuming that it is a complicated task and one they needn’t worry about if they do not have a high-net worth estate. Yet, that is untrue, and one of the primary estate planning mistakes people make.
Everyone should have an estate plan, regardless of tax bracket. And, if you have engaged in some form of estate planning, you have already managed to avoid this mistake.
Here are 3 other estate planning mistakes that you can easily avoid:
Don’t let the size of your estate justify cutting corners with your estate plan.
Even if you are not wealthy and do not have an abundance of property or assets, there is no estate too small to justify not having a comprehensive estate plan. Without a formal will, power of attorney and health care proxy, you are not able to guarantee that your wishes are carried out. Leaving your legacy to chance can result in a complicated mess after your death, leaving loved ones to deal with the fallout. Many individuals who have (what they believe to be) simple financial and family situations attempt DIY estate planning, but mistakes can happen and may result in costly errors. Regardless of the size of one’s estate, having your will and other estate planning documents handled by an experienced estate planning attorney is the only way to assure peace of mind to yourself and your loved ones.
Don’t create an estate plan and think the job is done.
While taking the time to create an estate plan is more than half the battle, it is important that you reevaluate your plan from time to time, especially when the circumstances of your life change. Life events that may require changes to your estate plan include marriage, divorce, remarriage, birth of children, the death of a beneficiary or trustee, changes to wealth or acquisition of new property or assets. Keeping your estate plan updated will prevent problems after your death and will make sure that all of your loved ones are provided for according to your wishes. Keeping the beneficiaries of your life insurance policies and retirement accounts updated is similarly essential.
Don’t forget about digital assets.
While estate planning may conjure up images of bequeathing tangible assets, there is another provision you should make it a point to touch upon in your estate plan. Your online presence is larger than you may think. With social media accounts, online credit and bank accounts, Bitcoin, digital downloads, music library, cloud-based storage, e-mail addresses and other digital assets, proper measures should be taken to deal with these assets if you are impaired. Leaving directives for the handling of these assets is important, as is making sure the accounts and passwords are available to your power of attorney or other chosen individual.
Estate planning is important, and regardless how simple you believe your financial situation may be, there are a number of concerns that require attention. We’ve touched upon a few of them here, but be sure to go over your full estate plan with an estate planning attorney to ensure that your legacy is secure and your family and loved ones are provided for.
The estate planning attorneys at Fields and Dennis, LLP have experience in the preparation of simple wills, as well as sophisticated trust arrangements designed to accomplish complex goals. Our estate planning lawyers can discuss your unique concerns and make sure that your plan takes into account all aspects of your estate.