Estate planning is one of the most difficult aspects of navigating the financial planning process. Among other complexities, no one likes to face the possibility that they will one day no longer be alive. Estate planning, however, is a critical process if you want to make sure that your assets are divided in the manner that you desire.
MISTAKE: Not Estate Planning at All
One of the most widespread problems with estate planning is that some people fail to engage in the process at all. There are various reasons why people decide not to engage in estate planning, such as the process’s complexity, a desire to avoid confronting mortality, and assuming that estate planning is unnecessary. In reality, most people can benefit from at least some type of estate planning.
MISTAKE: Believing You Do Not Have Enough Assets
Many people fall into the trap of thinking that estate planning is only for people with a large number of assets. While it is true that some estate planning strategies should only be utilized by those with the largest estates, mostly all people can benefit from creating an estate plan. If a person does nothing else, writing a will is one method to articulate to probate court how a person would like his or her assets passed on.
MISTAKE: Not Consulting With an Expert
The estate planning process can be full of countless challenges. Given that estate law is a constantly evolving process, you should not hesitate to obtain the assistance of an attorney who can help you with this process. Even if you merely need a simple estate plan that involves only a will, a seasoned estate planning lawyer can help to make sure that you do not overlook basic requirements when going through the process. For individuals with large estates, it is a good idea to consult with a financial planner as well as an estate planning attorney.
MISTAKE: Failing to Update Beneficiary Designations
Ideally, you will select important loved ones to act as beneficiaries when you pass away. In reality, however, life is full of challenges and designated beneficiaries can no longer be the parties that a person desires to receive assets. To make sure that the beneficiaries you appoint continue to be desirable, you should make sure to routinely review the terms of your estate planning documents and update them if necessary.
MISTAKE: Appointing a Minor as a Beneficiary
Some people make the mistake of naming minor children or other minor family members as beneficiaries of estates. The estate creator then passes away before the beneficiary reaches the age of majority. Appointing a minor beneficiary, however, is almost always a mistake. Instead of passing to the minor, the estate passes to a guardian. This step can be avoided if a person names either a custodian or trustee to manage a child’s inheritance.
Speak With an Experienced Estate Planning Attorney
The estate planning process is full of complexities, but an experienced estate planning lawyer can help make sure that you avoid the various challenges that can arise. Contact attorney Jim A. Lyon