What is Estate Planning?
Though common, not everyone knows what the term estate planning is. And this is because a huge percentage of people don’t see the importance in planning an estate. Estate planning is simply a plan an individual makes while alive for the management, distribution, and or disposal of their assets during their lifetime of after their demise.
Types of assets that can comprise of an individual estate include real properties (like buildings and lands), intellectual properties, cars, insurance, shares and stocks, banks accounts, including other personal properties.
Deadly Estate Planning Mistakes
- Failing to create an estate plan:
The first estate planning mistake on our list is the failure to create an estate plan. If you fail to create an estate plan that comes with a will, your assets might end up being distributed according to state law, irrespective of your wishes. To prevent this from happening, ensure you create your estate plan before it’s too late.
- Failure to update your estate plan
An estate plan is not something you create and lock up in your cupboard till you pass on. You need to update your estate plan regularly, especially after a significant event or occurrence like a divorce, the birth of a child, etc.
- Failure to update your beneficiary form
Of course, your will mirrors your intentions regarding your assets; that is who gets what, where, when, and how. However, a will is often superseded by other estate planning documents such as beneficiary forms for retirement plans, annuities, including life insurance policies. Thus, like your will, these forms must be updated.
- Failure to set up a trust
Failure to set up a trust is another deadly estate planning mistakes. Aside from being a tool used to facilitate the transfer of assets, a trust can also be used to bypass the expensive, stressful, and time-consuming probate process. Failure to set up a trust, will leave your estate at the mercy of probate.
- You don’t understand your estate plan:
Surprisingly, there are many people out there who don’t understand their estate place regardless of the guidance of a competent estate planning attorney. Simply signing estate planning documents, and not knowing what you are signing, or what it manes can be an issue.
- Failure to properly title assets
Both inside and outside of trusts, the way in which you own assets make a huge difference. For example, if you own properties as joint tenants with rights of survivorship, the assets will go to the other designated individual, like your spouse after your passing.
Not only is titling assets important, you should examine these designations regularly, just as you should your beneficiary designation.
- Failure to create a power of attorney
A power of attorney is a legal document that allows you to choose an individual who will make decisions for you if you become incapacitated. Failure to create this document will give the court the right to select an individual to make those decisions on your behalf.
Need an estate planning attorney?
Planning an estate can be a complicated process. It involves a lot of paperwork and legal documents like power of attorney, trust, will, etc. Thus, if you want to plan your estate the right way, it is important that you contact a professional.
An estate planning attorney can help you in several ways. This professional can help you plan your estate and help you create the necessary estate planning documents. If you need to update your estate plan, this professional can be of help as well. Also, if you have concerns or questions, contacting an estate planning attorney is the best way to find answers.
We boast of competent estate planning attorneys who can help you navigate the tough estate planning process. Simple get in touch with our office so we can offer you or your loved ones our professional services.