13 Estate Planning Mistakes You Don’t Want to Make
Many people make the mistake of thinking that estate planning consists of drawing up a will. That is like saying a tire is the equivalent of an automobile, Here are some of the more common estate planning mistakes people make.
Having No Plan
The most common mistake is having no estate plan at all. For most people this is due to procrastination. For others the thought of dealing with end-of-life issues is just too unpleasant to consider. One would hope that knowing you are planning for your own health and well-being—not to mention providing an organized and orderly inheritance for your loved ones—is motivation enough to overcome any hesitation you may have.
Not Seeking Professional Advice
You can research, organize and make decisions about much of your estate plan, but you can’t do it all yourself. For example, an estate planning professional can help you choose between a will and a revocable living trust. And that’s only the start. There are multiple parts to an estate plan, and help from a pro is the only way to be sure you haven’t left anything out.
Choosing the Wrong Executor or Trustee
Many people want to name a family member or trusted friend as their executor or trustee, but this isn’t always the best idea. In many cases, especially if there is any chance for disagreement among family members, a more objective third party might make more sense. It could even be better to hire a professional as trustee. It will cost money, but may avoid painful family squabbles.
Selecting Co-Trustees
Some people choose co-executors or co-trustees as a way to avoid conflict or give honorary status to someone they feel they might otherwise offend. However, even if the two people you choose agree 99 percent of the time, that final 1 percent can lead to years of legal battles and is not worth the trouble. Pick one person and stick with the choice.
Ignoring Sibling Conflict
Chances are if your children don’t get along now, things won’t get better after you are gone. Sibling conflict is a fact of life in many families. Preparing for it as part of estate planning only makes sense. The best way to do this is to communicate ahead of time so there are no surprises.
Giving Too Soon
If you establish a trust when your children are small, you may assume that by the time they are young adults they will be responsible enough to handle the money and property they inherit. Unfortunately, there’s more than a chance you may be wrong. It might be better to delay the inheritance until the children are older. Another approach is to give your trustee more discretion in deciding when they receive it.
Failure to Address Healthcare
A living will specifies the kind of medical care you do or do not want to receive if you are close to death. A durable power of attorney (sometimes called a medical power of attorney) designates someone to make decisions about your finances and healthcare. A living trust can also address these issues. On your Health Insurance Portability and Accountability Act (or HIPAA) form, you should list anyone with whom your doctors can discuss your medical condition and treatment.
https://www.rothira.com/estate-planning-mistakes
