If you want to create an estate plan that protects your interests, your assets, and your loved ones, then you need to know how to navigate the intricacies of the process. That might sound daunting, but your first step is to simply be aware of the common mistakes made during the estate planning process so you can proactively avoid them. This will get you much further in your estate planning journey than you might think.
Common estate planning mistakes you should avoid
Being cognizant of common estate planning pitfalls is crucial. Here are some of the most common and most disastrous that you’ll want to avoid:
- Procrastinating: Many people think they’ve got plenty of time to create an estate plan and that estate planning isn’t needed until later in life. But this isn’t true. You could be severely injured or suffer a medical condition that renders you incapacitated at a moment’s notice, or you could suddenly pass away well before anyone thought. If those events happen and you don’t have an estate plan in place, then your financial and healthcare decisions may be left in the hands of someone you don’t trust, or your assets will be subjected to the state’s intestate succession laws, which may not align with your asset distribution wishes.
- Not updating an estate plan: Life changes over time and so should your estate plan. Therefore, you revisit your estate plan documentation every few years to ensure it still reflects your wishes. You might also need to modify your existing plan if you acquire new assets, experience a birth or a death in the family, or see changed relationships with named heirs and beneficiaries.
- Failing to voice your intent: It’s usually a good idea to talk to your family about your estate plan. That way everyone knows what to expect when you pass away, which can reduce the chances that your family members will fight over your estate plan and what they perceive to be your intent.
- Not addressing your final arrangements: Your family will have a lot to deal with as they grieve your loss. This can make it difficult for them to figure out your final arrangements. But you can take the pressure off them by specifying in your estate planning documents what you want your final arrangements to look like. Your family will be thankful that you’ve done so.
- Forgetting about long-term care: Much of the estate planning process is focused on asset distribution. But don’t overlook the importance of long-term care planning. There is a good chance that you’ll need this care at some point in your life, and if you don’t prepare for it then the assets that you intended to pass down to your loved ones will be eaten up by long-term care expenses.
Don’t make preventable errors in your estate plan
The estate planning process can seem difficult and nuanced, but it need not be. You need to have a strong understanding of your estate planning options and what each of them can do for you. Armed with that knowledge, you can then work to avoid the mistakes discussed above. Your efforts here can set the stage for a successful estate plan that provides your loved ones with the future you want for them.