While it isn’t something people like to think about, we all need to think about what happens when we die. Dying without making a proper will or estate plan will make things difficult for your families; especially if you have young children or family members with special needs.
A lot of people prepare a basic will sometime within their lifetime and promptly forget about it, thinking they have the issue under control and that their interests are covered indefinitely. Most people aren’t aware that out-of-date wills can actually cause more problems than it solves. To help guide you or provide some insight on the matter, here is a list of the 4 most common mistakes that estate lawyers handle
Mistake 1: Not preparing a plan
There is an old saying that goes “if you fail to plan, you plan to fail.” Some people are under the belief that if they don’t need a plan since they don’t have plenty of assets. The reasoning behind this is that their insurance will be enough to take care of their families’ needs once they pass and that the heirs will just talk within themselves regarding the fair division of personal items.
The ugly truth is that death can sometimes bring out the worst in people. It isn’t uncommon to hear about families that fight over who gets what. Moreover, life insurance may not provide enough to cover the needs of children or your spouse and inheritance taxes may take up more than you know. An estate lawyer can minimize tax liabilities and maximize the benefits for your beneficiaries.
When you fail to manage your death, you leave your family’s future at the mercy of strangers.
Mistake 2: Your plan is outdated
As aforementioned, some people prepare their wills early on and then forget about it. This can cause problems. For example: if you prepared a will early on a few years into your marriage, this would definitely be unhelpful if you now have children. Other significant life changes can also nullify the validity of your will; things like higher income, divorce, number of children, etc.
An estate lawyer can keep your will up to date so that it always reflects your current status in life as well as the needs of your family.
Mistake 3: DIY Wills
Wills do not follow one-size-fits all solutions. Laws can be very different depending on which state you live in and these laws are changed and updated often. You do not want to manage your death, assets, and estate through an oversimplified solution. Everybody’s situation is unique and your family’s needs and your current liabilities and assets need to be addressed for what they are.
Your estate lawyer can evaluate your exact situation and give propose plans that will cater to you and your family’s needs in a much more detailed and organized fashion.
Mistake 4: Not verifying beneficiary designations
If you have some sort of life insurance, pension, 401k, or other similar plans, have you checked to see the beneficiary of these financial programs? Several people have died and assumed that stating the beneficiaries of their retirement accounts and investments in their will is enough. What these people did not know is that the designated beneficiary in certain financial accounts overrides the validity of wills, even those made recently.
If you set up your estranged step-daughter as the beneficiary of your 401k, a new will stating it should go to your grandson won’t overrule it.
Planning for your future and deciding where your assets go should always be done right. This is something you don’t want to do speedily and casually.