A well-drafted estate plan ensures your assets are distributed according to your wishes and can help avoid unnecessary disputes. However, a few common mistakes can occur even with the best intentions. Here are some of the most common estate planning mistakes to avoid.
Failure to Update Your Will
Your will should be reviewed and updated regularly, especially after major life events such as marriage. If you don't update your will, your assets may not be distributed according to your current wishes. For instance, if you relocate to another state, your will may no longer be valid. That's because each state has its laws governing wills and trusts. Additionally, changes in state laws may render your will invalid. If you don't have a will or your will is outdated, now is the time to take action. You can either draw up a new will or amend your existing one. A licensed estate litigation attorney can recommend the best course of action for your situation.
Failure to Plan for Advanced Directives
Advanced directives are legal documents that allow you to specify your medical treatment preferences if you cannot make decisions on your own. These directives can include a living will and a healthcare power of attorney. A living will outlines the types of medical treatments you do or don't want to receive if you're terminally ill or in a vegetative state. A healthcare power of attorney, on the other hand, designates someone else to make decisions on your behalf if you're unable to do so. Like your will, you should regularly review and update your advanced directives. This is especially important if your health changes or your designated decision-maker can no longer serve in that role.
Failure to Fund Your Trust
If you have a trust, you should fund it adequately. You should transfer ownership of your assets into the trust. An underfunded trust cannot achieve its purpose: to manage and distribute your assets according to your wishes. There are several ways you can fund your trust. For example, you can transfer cash or investments into the trust. You can also transfer real estate or personal property, such as jewelry or art. An experienced estate litigation lawyer can help you determine the best way to fund your trust and ensure it's done correctly.
Failure to Account for Estate Taxes
Estate taxes can take a big chunk out of your estate, so make sure you plan for them. For instance, you could create a trust that will pay the taxes on your behalf. You could also gift your beneficiaries to minimize the estate tax burden. If you don't account for estate taxes, your loved ones may have to sell off assets or take on debt to pay them. This could put a strain on their finances and cause unnecessary legal problems.
An experienced estate litigation attorney can help you navigate the complex world of estate taxes and ensure that your loved ones are protected.Share
25 March 2022
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