Confronting death and planning one’s estate is an unfortunate but inevitable part of life. If you care about your family’s wellbeing, then you need to take great care when planning your estate. If you don’t plan your estate carefully, their quality of life could be negatively impacted or they may be unable to continue living comfortably. Planning your estate meticulously and ensuring your family’s safety will make it easier to come to terms with dying.
There are lots of common estate planning mistakes that you need to avoid. In this article, you will find out what these mistakes are:
Estate Planning Trusts
If you’re not a trained lawyer or estate planner, you will have likely never heard of an estate planning trust before. There are several estate property trusts that you need to consider, including living trusts, credit shelter trusts, and marital trusts. Trusts allow you to limit the amount of tax and fees that your family pays on your assets after your death. There are many other advantages to having an estate planning trust. If you hire a lawyer [which is strongly advised], then they will organize your trust on your behalf.
Contacting a Lawyer
All estate planning experts recommend hiring an estate planning attorney to manage your estate for you. People who attempt to plan their own estates often make mistakes; these mistakes can be very costly. If you aren’t a trained estate planner, you will likely have no knowledge of how to minimize taxes, fees, and inconveniences for your family when they are dealing with your wishes, after your death. A lawyer on the other hand will have plenty of experience and will be able to plan your estate for you, then act as an executor after your death.
Failing to Plan
One of the most common mistakes made is failing to plan for one’s death. If you die without planning your estate, your family will have to pick up the pieces after your death and may suffer. If you don’t plan your estate, then members of your family who aren’t close with may take legal precedence and may inherit your assets. This could leave the people that you actually care about out of pocket and unable to continue living their lives comfortably. It is especially important to plan your estate if you are unmarried but have a partner with who you want to inherit your assets.
Discussing Your Estate
If you are on good terms with your family members, then it’s important to sit down and discuss your estate with them. A very important part of the estate planning process is transparency and discussion. You should discuss with them what you think is best and hear out their suggestions. There might be assets of yours that relatives want after your death, such as keepsakes and souvenirs. You should be completely transparent with your relatives about what you plan on doing with your estate. If you don’t make it clear what your intentions are, you could upset people after you pass away.
There are many reasons why one might only name a single beneficiary in their will. This could be because they have fallen out with their relatives, or because one simply does not have many family members or friends. Most estate planning experts advise against naming a single beneficiary, however. This is especially true if you are leaving behind a sizeable estate. There are always charities and people to whom you can leave assets. With that said, if your estate’s beneficiary is your wife or only child, and not leaving your entire estate to them would negatively affect their quality of life, then you should indeed try to leave everything to them.
Power of Attorney
A common mistake made by people who plan their own estates is forgetting about the power of attorney and the appointment of healthcare representatives. If you are ever seriously injured, or you lose mental capacity and haven’t appointed a power of attorney, then the courts may elect somebody to act on your behalf. This could result in a person to whom you have very little connection being in complete control of your life. It is very important that you consider this when you are planning your estate.
In our modern world, many people hold digital assets. If one were to die without mentioning these in one’s estate, it’s unlikely that one’s relatives would have any idea that these assets even exist. It is very important if you do hold digital assets, that you include details of them in your will. You must also include the account names, passwords, emails, and a written declaration signing ownership of these assets over to your will’s beneficiaries. If you do not do this, then the platforms that your assets are held on may not release them.
If you have any charities that you are particularly passionate about, then it’s important to name them in your estate. As mentioned earlier, if you have an especially large estate, then you could leave money to your favorite charities. Some charities erect statues, put up photographs, or put plaques down to commemorate people who have left them money. This is a great way to leave behind a positive legacy and ensure that you are fondly remembered by people as somebody who genuinely cared. If you do have any charities that you want to leave money to, carefully plan out how much you can afford to donate to them, and then discuss it with your lawyer.
Many people leave sizeable estates behind to their children, without ever considering their children’s futures. Experts have found that children who are left with large sums of money rarely spend it wisely, even as they mature and become adults. This is because they have not worked for it, and so, treat it as if it were free. Consider this when you are planning your estate. You could set up trusts, foundations, or invest your children’s inheritances for them.
If you make a mistake with your estate’s plan, you could negatively impact your loved ones. By following this article’s guidance, you will be able to limit mistakes, and ensure that your estate is planned meticulously.