Estate planning is the way of handing down your assets to your family, known as heirs or beneficiaries, after your death. However, there can be things through the whole process that can slip through your mind which is why you need an experienced estate planning lawyer. Here are the top mistakes a lot of people can make when going through an estate planning process.
Not Planning At All
The biggest mistake one can make when making end-of-life arrangements is to not opt for an estate plan at all. This is not the way to go about asset division. You’re not being mindful of the future of the people you’ll be leaving behind after your passing, so you must do, go for an estate plan and have a lawyer help you out with the details.
Keeping Family In The Dark
Another thing a lot of people do, when committing to an estate planning process, is to keep everything from the family. This isn’t the brightest idea, because you want your family to know what you’re doing and how you’re planning for things to be settled after your passing.
This is going to ensure that all of the concerned people in your family are enlightened about the situation and they can help you with certain things. Keeping your family and possible beneficiaries in the dark won’t “protect” them, but you’ll only be damaging their position.
Not Naming Beneficiaries
A lot of people can leave this task for later. Naming potential beneficiaries is very crucial because these people are the ones that you’ll be supporting after your death and you need to think clearly about the selection. However, that doesn’t mean that you don’t select any at all. This goes for both primary and secondary beneficiaries.
Primary beneficiaries are those people who are directly related to you, like your spouse, children, parents (if they’re alive), etc., and secondary beneficiaries are those people who will get your assets, in case the primary beneficiaries die before you do. These things are hard to consider for some people, understandably, but they still need to be looked over for the betterment of other people involved.
Not Having Options For Beneficiaries
A common estate planning mistake is not having enough options for beneficiaries. This can also be a huge obstacle for potential people who deserve to be supported after your passing, but this is also a fact that can easily slip through your mind when making arrangements.
So, try to have at least a few options for beneficiaries, in case something unexpected happens and you’re forced to choose on the spot. It’s better to have someone who’s truly deserving of your support and it’s also a good idea to think ahead of time.
Not Funding Your Trust
A trust is one of the easiest ways to set up an estate plan and save money for the people who matter in your life. They’re very safe and accessible if you have certain rules, but all of this can go down the drain if you’re not funding it at all.
You need to replenish the trust from time to time and add money to it if you want it to be beneficial for your beneficiaries in the future.
Not Making Final Arrangements
Speaking of end-of-life arrangements, there can be people who don’t make any at all. This is not the way to go about things. End-of-life arrangements can be pretty hard to make, especially if you’re going through the waves of life and coming to terms with certain unpleasant things, but it’s an important task that you need to think about and get over with because this is not only for your comfort and peace of mind but for your family as well.
You don’t want them to be struggling after your death and the best way to do so is to have everything planned from your funeral, to your final regards and wishes. Your will should also state an executor so they can execute the will in the probate court. You can also select a probate lawyer for that process or leave this decision to the executor.
Not Considering Healthcare Representatives
There can be times when people, especially owners of the assets, are unable to make decisions for themselves and they need to hand over this task to a healthcare representative through a power of attorney.
This is also a very common thing people can forget, especially if they’re suffering from ailments that allow them to be incapacitated. This is why you need to have a handful of trusted people who can make the decisions on your behalf.
Forgetting About Charities
Beneficiaries are not just the people who are your family. A lot of the time, there are special charities that are close to your heart and are doing great things to change the world, that can be deserving of support too.
This is also something a lot of people can forget and you don’t want to be in the same boat. It’s important that when you’re making an estate plan, you’re also keeping charities and other organizations in mind for regular donations over a long period, or gifting them a huge sum of money after your passing.
Forgetting About Taxes
Taxes are not fun, but they’re not unimportant. Before anyone can even proceed with an estate planning process, it’s crucial to have taxes out of the way. This is the only way by which you can proceed with an estate planning process, without any hurdles.
Before consulting a lawyer about the commencing of an estate planning process, you must have all of your dues cleared, as far as taxes are concerned, because if they’re not, then that can put a damper on the process altogether and you won’t be able to replenish the plan or update it before you get the taxes paid.
Not Thinking Long-Term
Believe it or not, people don’t think long-term, even when they’re thinking about their passing and how to make their family comfortable afterward. This can be a huge deal for a lot of people because they want quick and easy fixes and they don’t specifically think about the long-term merits and demerits of certain decisions they’re making.
This is why it’s crucial that you’re mindful of the fact that the world is not going to be the same, after 10 or 20 years, financially speaking, and you need to think about the best possible outcomes for your family.
Not Updating Your Plan
It’s also quite important to update your plan as you go. If you’re an early bird and started the estate planning process way before than it was originally needed, then aside from patting yourself on the back, you also need to be mindful of replenishing and updating it from time to time.
If you have more assets and money to add to the plan, then you can do so. If there are any policies or terms that need some revision, then that can also be dealt with ease, and without problems.
Conclusion
Estate planning is a very easy and simple process, but sometimes there might be things that can turn south. This is why it’s good to know about the common mistakes people can make regarding estate planning. To avoid these mistakes, get guidance from an estate planning attorney.
