Over half of all Americans do not have an estate plan. If you have finally decide not to be one of them, and are prepared to finally create your own estate plan, make sure that you avoid some common mistakes.
As tempting as it may be, do not rely on “do-it-yourself” estate planning forms. This is not the area of your budget where you want to choose saving money over substance. More importantly, in the long run, using generic forms may cost your loved ones considerably more than you saved by using them. Even a simple mistake in your estate plan could invalidate the entire plan and your beneficiaries will pay the price in the long run.
As you create your estate plan, take the time to understand the difference in property ownership laws. Jointly owned property, for example, can be owned in more than one way. The exact words that are used on the ownership document will determine what happens to the property after your death. It could transfer directly to the co-owner, or could become part of your probate estate
Be sure to include tax and probate avoidance in your planning. Remember that every dollar you save in taxes is a dollar that will go to your beneficiaries. Likewise, the more assets that you can keep out of probate, the less probate will cost and the more your loved ones will receive.
Last, but not least, be sure to review and revise your plan on a regular basis. Changes in the law or important life events may warrant a corresponding change to your estate plan.
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- Leaving Assets Can Be Tricky – Part 3 - August 13, 2020