Common Mistakes in Estate Planning
Estate planning is an uncomfortable topic for most people since it deals with one’s own mortality. However, failure to prepare a proper plan can result in an expensive probate battle and your wishes may not be fulfilled since the government will be determining the distribution of your estate.
Despite having to face uncomfortable issues, the best thing you can do is to create an Estate Plan. Here are some of the most common mistakes:
1. Failure to Plan- People procrastinate and it’s too late. People keep putting it off, but once you have dementia, it’s too late to create a Will or other legal document.
2. Thinking a Will is all you need– A Last Will & Testament is a good start. However, a Will created off the Internet is often disqualified and kicked out of Court for failure to comply with specific legal requirements. A Will also requires that your estate go through probate which is a lengthy and costly process.
3. Power of Attorney– Most people don’t realize that a Power of Attorney becomes null and void once the person passes away.
4. Advance Directive– An Advance Directive for Healthcare does NOT grant medical decision making privileges. You need a Healthcare Power of Attorney for that authority which also contains a HIPPA release authorizing your agent to speak to healthcare providers.
5. Funding the Trust– Once you create a Trust, you need to transfer ownership of your property into the Trust to “Fund” it.
6. Keeping Things Current– Estate Plan documents should be reviewed every year to ensure that the persons named as fiduciaries and beneficiaries are still valid.
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