6 Common Estate Planning Mistakes
Estate planning can be one of the most daunting and unpleasant tasks for an individual. No one really likes to contemplate their death, so it can be unsettling to develop a comprehensive estate plan.
Although it’s something many people choose to avoid, creating an effective estate plan is essential if you want to ensure your assets are distributed in the manner you desire after passing away. Leaving a comprehensive estate plan with clear instructions for your heirs is one of the best decisions you can make.
To help make the process easier, here are six common estate planning pitfalls that you’ll want to avoid.
Mistake #1: Not Creating an Estate Plan
The biggest estate planning mistake is to avoid forming a plan. Unfortunately, this mistake is far too common. People often avoid estate planning because of its complexity or reluctance to accept the inevitability of death.
The reality is that everyone needs an estate plan. Life is unexpected and the death of a loved one can occur at any given time. Estate planning is also particularly important if you have multiple assets you’d like to pass on to family members.
There are several benefits to creating an effective estate plan for you or a family member. Some of these include:
- Ensure your family is taken care of in the event of your death
- Provide for family members or loved ones with special needs or circumstances
- Prevent family conflict over money
- Minimize expenses
- Reduce taxes
- Ease the burdens of your family while they are grieving
- Support your favorite cause
- Have a plan for incapacity so your financial and healthcare decisions can be made by the people that you choose without the need for probate court intervention
- Name a guardian for any minor children you may have
- Make retirement easier
Mistake #2: Failing to Update Your Estate Plan
An estate plan can change at any second. Life events such as divorce, marriage, death of a family member, or a diagnosis of serious illness can alter an estate plan unexpectedly.
It’s also important to remember that beneficiary information must be kept up to date. If the beneficiaries on your investment accounts, life insurance policy, and retirement accounts are not reviewed regularly, proceeds could go to someone you did not designate such as an ex-spouse.
Keeping your estate plan updated, especially during life events, will ensure that your assets are distributed as intended.
Mistake #3: Forgetting Digital Assets
Many people put a considerable amount of their lives online, and as a result, they create several digital assets. However, they may not always remember to account for them since digital assets are not as tangible as physical assets. It’s important to remember, however, that property is no longer what you physically own but what you digitally own.
When creating your plan, be sure to include details as to how you’d like all your digital assets to be handled after your death. Online photo albums, online banking, and social media posts could all fall into the category of digital assets.
Mistake #4: Forgetting About Your Pets
While pets aren’t considered assets, this doesn’t mean you can’t include them in your will. Pets are personal property, and thankfully, you can decide who gets your pet when you are gone. Sadly, many pets are sent to a shelter after their owner’s death because they did not construct a plan.
You can plan for your pet by designating a caretaker and setting up a pet fund that enables you to set money aside for your pet’s care.
Mistake #5: Not Discussing Your Estate Plan with Your Family
Many people make the critical error of not discussing their estate plan with their family before their death. Communication is imperative in estate planning, especially when your plan includes unequal asset distributions among your children.
A failure to communicate can cause misunderstandings, resulting in a considerable amount of unnecessary and costly litigation.
Mistake #6: Not Working with An Experienced Estate Planning Attorney
Estate law is complex and ever-changing. This is why it’s important to secure an experienced estate planning attorney in Ventura, CA that can help you craft an estate plan to meet your needs and goals. Even if all you need is a trust or a will, working with an expert can help ensure you don’t overlook important requirements when completing paperwork.
If you’re interested in speaking with a qualified California estate planning attorney, Botti & Morison Estate Planning Attorneys, Ltd. can be your best resource. The attorneys at Botti & Morison Estate Planning Attorneys, Ltd. carry over 60 years of estate planning experience. They have the knowledge, tools, and resources needed to guide you through every step of the process.
Founder attorney, Christopher E. Botti, is also a Board Certified Specialist in Estate Planning, Trust, and Probate Law.
To set up your first consultation with one of our lawyers, call (877) 585-1885 today. Botti & Morison Estate Planning Attorneys, Ltd. serves clients in Bakersfield, Santa Barbara, San Luis Obispo, Valencia, Ventura, and Thousand Oaks/Westlake Village, California.