Your estate plan is your opportunity to decide what happens to your assets when you die. An estate plan, however, is only as good as the person who created it. When it comes time to create your estate plan, consider the following eight mistakes that you want to avoid making:
- Not creating an estate plan–The old adage applies here “failing to plan is planning to fail”
- Not updating an estate plan—Your plan should be updated every five to ten years or when a life change, such as a marriage, divorce or birth, warrants a change
- Not being objective—Choose your executor and trustees based on the best person for the job, not because you don’t want to offend a family member
- Not gifting assets prior to death—gifting assets before death can drastically reduce your estate’s exposure to estate taxes
- Not making use of the unified credit—Leaving assets directly to a spouse can cause his or her estate to incur estate taxes upon death.
- Not paying attention to changes in the law—Laws relating to trusts, taxes and estates change all the time and could directly impact your estate plan
- Not planning for your incapacity—Your estate plan could completely fall apart if you fail to plan for your incapacity and someone untrustworthy or without your best interests at heart gains control of your finances and estate assets
- Not providing immediate access to cash—If you have a family that depends on you for support, don’t forget that they will need immediate access to cash to survive on while your lager assets make their way through the probate process
- The Magic of Grantor Trusts - November 1, 2023
- IRS Confirms Grantor Trust Status Alone Does Not Cause a Step-Up in Basis - October 26, 2023
- Understanding the Importance of the Simultaneous Death Act - October 19, 2023