Biggest Estate Planning Mistakes to Avoid

Life is uncertain, and estate planning can help bring some certainty to your life when things don’t go as planned. At its very core, estate planning ensures that your assets and wishes are organized according to the way you best see fit. Estate planning can also help provide coverage for your loved ones in the event you lose control of your faculties, are unable to advocate for yourself or pass away.

Working with an experienced estate planner can help you navigate what may sometimes feel like a complicated and overwhelming process. In Washington State, Vancouver estate planning attorney John Lugensis committed to providing trusted advice and guidance as we help you organize and plan out the control of your assets. Contact John Lutgens today to schedule an initial case consultation and learn more about how estate planning can help guide you and your family during life’s uncertain times.

Avoid These Estate Planning Mistakes

Estate planning can take on many formsbut is incredibly versatile to meet the needs of all individuals. Even with this in mind, it’s important to avoid these common estate planning mistakes.

1. Avoid Procrastination

Estate planning is not the top priority for most people. After all, it’s not the most glamorous task on anyone’s to-do list. Still, it’s important to consider estate planning as early as possible to make sure any assets you’ve accrued are protected.

It’s estimated that only one-third of adults have estate planning documents. These dismal numbers can have unprecedented consequences, one of which is losses for surviving family members who may be entitled to assets after a loved one’s passing.

Failure to implement estate planning, including a living trust or will, may mean that the courts will get involved to determine who has rights and control over your assets. Additionally, once the courts are involved, there are tax liabilities that could result in avoidable financial losses a beneficiary or the estate may be forced to endure.

At the very least, all adults, no matter how young or old, should have some sort of document in place that expresses their end-of-life wishes.

2. Keep up to Date With Wills, Forms, and Other Documentation

If you’re one of the 33% of Americans who already have end-of-life preparation documents in place, then it’s important that you maintain regular upkeep of associated documentation. Estate planning documents should not be a one-and-done task. It can help to take annual assessments of what’s in your end-of-life directives to ensure they’re still relevant. Additionally, as you lose and accumulate assets and relationships, you may want to make adjustments to your estate planning documentation as well.

3. Update Your Beneficiaries on All Forms

When updating a will or living trust, an individual may add or remove people from their end-of-life preparations, the role they may play, or the assets they’ll be entitled to. When updating beneficiaries, it’s also important to remember to update beneficiaries on other important accounts. For example, if you have a life insurance policy, a retirement account, annuities, or other assets, be sure to update listed beneficiaries so that they align with whoever is listed on your will.

4. Title Your Trusts

If you intend to put assets like real estate, stocks, mutual funds, or cash assets into a trust, then it’s important to retitle that asset so that it belongs to the trust and not to you. This is a very easy and simple step to do, but it’s also one that can be overlooked. Initially, when a trust is established it’s easy to have assets titled to that trust. But as assets accrue and the circumstances of your life change, an asset or account might go unnoticed, meaning it was never retitled to the trust.

5. Co-ownership of Assets With Children

Another common mistake made by individuals who are new to estate planning is naming children as co-owners of an asset. Co-ownership with children is a no for several reasons. One of the most critical is that your children’s creditors may be able to have access to assets you and your children co-own. This means that in the event of your passing, your child’s creditor may be able to tap into your assets to recoup debts.

To protect the interest of loved ones such as children, it’s better to have your child named as your power of attorney and to have them be a payable-on-death beneficiary on your accounts. As your power of attorney, your children will be able to make critical financial decisions during your lifetime but will also be able to recover those assets in the event of your passing.

6. Have Discussions with Friends and Family

During an unexpected or sudden event, it’s important that your loved ones have some idea of whether or not you have estate planning documents in place. Having a conversation about your end-of-life wishes even early on in life can help dispel some of the confusion.

For example, you should (to the extent you’re able to do so) discuss what estate planning documentation you have in place, who may be a power of attorney or beneficiary, and where you store copies of your living trust or will if it is needed. Of course, it’s important to have these conversations only with individuals you trust. For some people, confiding in the legal team that has helped them put together their estate planning can be a viable solution.

Work With an Estate Planning Attorney

Estate planning can be overwhelming and confusing. That’s where the expertise of an estate planning attorney can prove invaluable. Attorney at law John Lutgens is an experienced elder and estate planning lawyer who can help you and your family prepare for life’s most unexpected events. Reach out to the law office of John Lutgens at 360-693-2119 to schedule your free consultation.