Your estate plan may be the most important set of documents you ever create. With that in mind, mistakes should be avoided whenever possible. The average person, however, knows very little about estate planning, making mistakes common. To help prevent you from making a costly mistake, the Los Angeles estate planning attorneys at Schomer Law Group, APC discuss five common estate planning mistakes you can avoid making.
- Not planning. People are frequently under the mistaken impression that an estate plan isn’t necessary unless you have amassed a significant amount of valuable assets or until you have a family. The truth of the matter is that every adult can benefit from having an estate plan in place. Whether your estate consists of only personal property and a small savings account, or you have amassed an empire, if you die without an estate plan in place the State of Florida gets to decide how any assets you do own will be distributed. Family heirlooms could be distributed to people you would never give them to, or worse, they could be sold to provide an equal distribution of assets among your legal heirs.
- Appointing the wrong fiduciaries. The average estate plan includes several fiduciary positions within the plan that are appointed by the creator of the plan. In your Last Will and Testament, for example, you will need to appoint an Executor. Likewise, if you incorporate a trust into your plan, you will need to appoint someone as the Trustee of that trust. A common mistake is to appoint a spouse, friend, or family member to fiduciary positions without considering their suitability for the position.
- Failing to update your plan. Not having an estate plan at all can be problematic; however, having an estate plan in place that is out of date can be even worse than not having one at all. For instance, imagine how you would feel if you were to suddenly become incapacitated, requiring someone to step in and take over your finances and make healthcare decisions for you and the person you have designated to do so is your (now) ex-husband/wife? Although there is no hard and fast rule, most estate planning attorneys suggest a routine review every three to five years until you reach retirement age, at which point you can move to every five to eight years. Of course, certain events, such as a marriage or a move to a new state, will prompt an immediate review and revision of your plan.
- Going the DIY route. Because of the ease with which you can locate all sorts of DIY legal forms on the internet is can be tempting to go the DIY route when creating your estate plan to save time and/or money. In the long run, however, doing so will likely cost your loved ones even more time and money given the frequency with which DIY legal documents cause the need for protracted litigation because of mistakes, errors, and omissions. Your estate plan is simply not the best way to save money.
- Failing to plan for incapacity. Estate planning requires you to consider the possibility of your own death. While this is not easy to do, most people manage to get past the emotional aspect of planning for their own death because they recognize the need to do so. Your death, however, is not the only thing that you need to plan for in your estate plan. Incapacity planning should also be included in your comprehensive estate plan given the odds of suffering a period of incapacity at some point in your life. If you do become incapacitated, someone must step in and make decisions for you and handle your estate until you are able to do so yourself. Unless you want a judge to decide who that person will be, you must include an incapacity planning component in your estate plan.
Contact Los Angeles Estate Planning Attorneys
For more information, please join us for an upcoming FREE seminar. If you have additional questions or concerns about estate planning, contact the experienced Los Angeles estate planning attorneys at Schomer Law Group APCby calling (310) 337-7696 to schedule an appointment.