Everyone needs an estate plan – even people who don't have any personal assets. This is because estate plans cover more than just financial concerns. An estate plan will designate who will care for your children in the event of your incapacitation or death. For that matter, an estate plan will also establish who will care for you – with regard to your medical and financial decisions – if you're too ill or injured to make such decisions for yourself.
When you're creating a viable estate plan, there are many pitfalls that you can make if you're not careful. Here are two common errors that inexperienced estate planners make:
Failing to update your estate plan: Your last will and testament and the rest of your estate plan are not static. As you grow older, your family and finances will change. Even estate planning laws will change. It is therefore important to update your will and estate plan on a regular basis to ensure it's up-to-date. At the very least, check in with your entire estate plan every five years. Also, update it after any major life event such as a death, birth, divorce or other changes in your family.
Choosing the wrong executor: You cousin, Mary, your brother, Clark, or your son, Bob, all seem like appropriate choices to handle your estate, but are they capable of handling the task? Are they healthy enough, experienced enough and wise enough to navigate the nuances of your will, real estate assets and financial affairs? And, can they serve as executor without causing family infighting. Choose wisely when you select an executor, make sure they're up for it, and – if necessary – select a professional, such as a trusted banker or attorney, to handle this important duty.
Are you ready to set up your estate plan? The more you know about your estate planning options, and estate planning law, the better you'll be able to complete the process without making any of the most common estate planning mistakes.
Source: FindLaw, "10 Common Estate Planning Mistakes to Avoid," accessed June 01, 2018