Very few people enjoy the idea of preparing an estate plan – aside from reminding you about your mortality, estate planning can be incredibly overwhelming for those without a legal or financial background. But estate plans are critical to the long-term success of your family and your legacy, and so it’s crucial to make sure that you’re fully prepared in the event of a tragedy.
At Percy Law Group, PC, our estate planning attorneys are here to help you navigate this often-confusing landscape. With skill and precision, we can root out exactly what’s important for you to include in your document portfoliom and which terms and conditions may work best for your financial and familial needs. We can also help you spot key estate planning mistakes well in advance, and avoid a costly disaster for your family.
For this blog post, our attorneys have identified the top 9 most common estate planning mistakes, and provided some suggestions about how to avoid them.
Here are the top 9 estate planning mistakes you need to know about:
- Leaving your fate up to probate. You may be surprised, but many people don’t believe that they need to have an estate plan at all – and it’s estimated that almost half of all American adults don’t have a plan right now. All wills go through the probate process, but if you die without a clear plan in place, your assets will be distributed as the court sees fit. This can often lead to sibling disputes and a myriad of thorny legal issues.
- Misunderstanding the estate plan. It's important for you to understand exactly what you've signed in an estate plan. While a skilled lawyer can help you get a better sense of the legal issues behind each of your estate decisions, it’s ultimately up to you to confirm whether your plan will be a good fit. This is difficult to accomplish when you don’t take the time to ask questions or clarify certain issues.
- Picking an inappropriate executor or trustee. When selecting an executor or a trustee for your will, you should only pick someone who you can trust entirely. However, some people make the mistake of choosing a family member or friend who will not be equipped to resolve painful and complex family disputes. If you foresee any issues with your executor, consider designating a third party or a professional to manage your estate instead: It could save your family thousands of dollars in the long run.
- Failing to prevent sibling conflict. Family conflict over an estate plan can be difficult to avoid, even if you hire the best attorneys for the job. That being said, it’s crucial to know your family’s unique needs and prepare them ahead of time if you anticipate any problems. By letting them know what decisions you’ve made – and communicating those decisions clearly – you could be on track for a smoother situation post-mortem.
- Having outdated beneficiaries. If you’re one of the 50% that happens to have an estate plan, you’ve already taken the most important step towards securing your family’s future. Of course, many people forget that estate documents are living documents, and that your designated beneficiaries, trustees, and executors may die before you. That’s why it’s recommended that you review your estate plan every 5 years or so, and always double-check it after a major life event or death in the family.
- Leaving a poorly-planned gift for your children. Gifts come with the best of intentions, but you should also consider the needs of your children and other beneficiaries before you put them in your estate plan. By giving them properties they don’t want, or adding strict requirements about how they can use the assets, you may be setting your children up for a lengthy legal battle, rather than an enjoyable inheritance.
- Omitting a residuary clause. Think of a residuary clause as a kind of legal “catch-all,” which allows you to cover any miscellaneous properties that you didn’t remember owning (or couldn't predict). Whether it’s a strip of land that you didn’t know you owned, or a diamond necklace left to a deceased heir, there are plenty of circumstances where a residuary clause has allowed the family to retain their assets.
- Giving assets directly to minors. You may be tempted to bypass an estate plan altogether and put your child’s name on a property deed, but this is a recipe for disaster. These individual gifts can be taxed heavily, whereas an inheritance may not face the same steep penalties in probate court.
- Failing to plan for a disability. Death isn’t the only outcome that can affect your family: If you become seriously disabled or put into a comatose state, you will want to have someone taking care of your family’s needs in your stead. That means planning for a conservatorship in the event that you lose your consciousness or will.
Need Help? Call Our Skilled Estate Lawyers!
At Percy Law Group, PC, we’re committed to helping our clients avoid all these mistakes, as well as the many others that can come with estate planning. We know that it’s often difficult to consider the prospect of your own death or disability, and to create a plan that will unite your family with positive memories of your legacy. Our compassionate lawyers will help to protect you from a negative outcome, and do our best to mitigate your tax burden in the long term.
Call (508) 718-2545 today to learn more!