Don't Fall Prey To These Estate Planning Mistakes

Posted on: 28 August 2017

Most people by now realize the importance of making plans for their financial affairs in the event of their deaths. It's not only millionaires who need to set up a good estate plan; after all, everyone who has something of value that needs to be dealt with should create a will and make other arrangements in an effort to simplify matters for those left behind. If you are not careful, however, mistakes can happen. Read on to learn more about some common estate-planning errors and how to avoid them.

Putting it off too long

It's never easy to consider what could happen if you are no longer here, and it's perhaps only natural that some people put off making those important arrangements for far too long. You may decide to put off creating an estate plan until you are older or richer, but death can occur suddenly no matter how old you are or how much you have in your bank account. The time to begin is now, when you have plenty of time to do the research and make a plan that is comprehensive and that can be updated easily if needed.

Failing to update the plan

When your life changes, so should your estate plan. It may not be necessary to redo the entire will or trust, you can always just add a codicil and in most cases updating plans takes only a few minutes. Any changes in income, property owned, businesses owned or sold, relationships, marriages, births and more should prompt an update. A phone call and a quick trip to sign the paperwork and you have made the changes needed.

Failing to plan ahead for a disability

People are living far longer than in times past, and this can mean a need for more planning on your part. You should just assume that you will need provisions in place to deal with illnesses, disabilities and incapacity. Consider some of the following:

  • A revocable living trust, which can take the place of some issues covered by a will but with some advantages over a will.
  • A medical power of attorney, which will name a trusted friend or family member to make medical-related decisions on your behalf if you are unable to do so.
  • A durable power of attorney, which names a trusted person to make financial and business-related decisions on your behalf.
  • A living will, which sets out your end-of-life wishes in regard to resuscitation.
  • A long-term extended care plan for a nursing home or assisted living facility.

Speak to an estate planning attorney, like one from Seiler & Parker PC, to learn more.