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Estate planning pitfalls to avoid

On Behalf of | Nov 1, 2021 | Estate Planning |

Responsible individuals understand the importance of estate planning. Still, even wealthy persons make mistakes when preparing for the future.

According to a survey by caring.com, a third of those who need an estate plan are doing nothing about it. One assumes they are more likely to take action once they know what errors to steer clear of.

Pitfalls to avoid

Forgetting to name a power of attorney or a healthcare representative is a major mistake. These agents make vital decisions for a client in the event of incapacitation.

Some fail to detail what they wish to happen after their passing. Official documentation must spell out exactly how funerals and related matters should proceed.

Another miscalculation is not being specific enough or getting too specific. Strike the right balance with the help of an estate planning professional. Other faults include not accounting for taxes and ignoring trust fund responsibilities.

Actions to remember

Preparing to meet with a planner is essential to creating effective documentation. The best clients set aside time for compiling pertinent information before speaking with an expert.

It is usually a good idea to discuss intentions with friends and family. Doing this airs concerns before disagreements become a source of contention.

Estate plans need periodic updates. Revisit them once every three to five years. Major life events, such as marriages, births, and deaths, need to be part of the discussion.

Planning for the future is essential, but it can be tricky. Those who approach the task with diligence are more likely to avert common missteps.