New Year’s Resolutions: Make Estate Planning One Of Them
The New Year’s holiday has passed us by, and now, we are in a bit of a holding pattern until spring. According to Forbes, around 41% of Americans make New Year’s resolutions each year, and most involve improving mental health, being more active, losing weight, and eating healthier. Might we add another New Year’s resolution to the group, one that you might not have thought of?
Make estate planning one of your New Year’s resolutions. There are plenty of benefits to estate planning, including the ability to control where your assets go after you die. You also will avoid probate court, and you’ll have the ability to arrange guardianship for kids, end-of-life healthcare, and more.
If you’ve already written, “Make an estate plan” in your list of New Year’s resolutions, good for you! In this article, we’ll talk about common pitfalls to avoid when fulfilling this resolution. Many of these pitfalls, happily, can be circumvented by taking advantage of the counsel of a licensed legal professional.
Pitfall 1: Outdated Documents
If you already have an estate plan, you should know that the rule of thumb is to check it every three to five years or if you experience a major life change (divorce, death, marriage, new births, etc.). Outdated documents are a huge pitfall for people who have an estate plan, as not changing your plan with the times means that you’ll forget about new heirs or, conversely, include people in the plan who are no longer in your life.
Pitfall 2: Procrastinating
Of course, a document can only be outdated if it’s there in the first place. A major pitfall in estate planning is the failure to start. Not to sound gloomy, but anything can happen. Life is fragile, and sickness, injury, and death aren’t exactly unheard-of phenomena (we’d be out of a job if they were).
Don’t wait until something bad has happened to make an estate plan or encourage a loved one to do so. The main hook of estate planning is that it is preventative and protective. Contact an attorney today, while you still have your health, to create this plan for the future.
Pitfall 3: Naming Only One Beneficiary
This one is quite common, as naming just one beneficiary is usually more likely to occur to people than having a backup plan. You should always list more than one beneficiary for your assets, a fact that your lawyer will likely reiterate to you. If the beneficiary dies before you do or is out of your life for another reason, you will need to have a contingent beneficiary who is next in line to receive that asset. This is an easy enough pitfall to avoid—you just have to have a backup plan.
Pitfall 4: Not Talking To Your Family First
Estate planning can sometimes be the cause of difficult conversations among family members. Make sure you talk to your family and keep them in the loop when estate planning. Let them know who the beneficiaries and appointed individuals are (and, if need be, why you made those decisions). That way, there are no surprises, and this disclosure can make it less likely that a will challenge will come about.
Pitfall 5: Lack Of Full Disclosure
Attorneys are here to help you, and you need to exercise full disclosure when you’re speaking to one. Tell them your concerns, goals, and financial situation, and the attorney will be able to craft the best estate plan for you. Holding back will only lead to missed documents, incomplete information, and other similar, equally-problematic events.
Though these pitfalls might seem intimidating, they can often be avoided through honest communication with your lawyer. Estate planning can help you secure your financial future, as well as the futures of your beneficiaries and heirs. Talk to an WFP estate planning attorney today to learn more about this important process.