Many of our clients come to us in need of help with the estate planning process. Derryberry & Associates LLP is always ready to help you come up with a proper estate plan for your family so that they are taken care of in the event of your demise. Many times, people fall into some common pitfalls with estate planning that have serious impacts on their assets and estate. Tax laws are constantly changing and it’s important to revisit your estate plan with an estate planning lawyer around every 3 to 5 years to make sure it is up to par. Avoiding estate planning pitfalls is easier if you know what to watch out for, so keep reading on to learn about 3 important estate planning pitfalls to avoid.
1. Choosing the Wrong Executor
When you are creating an estate plan, you will need to select the executor of your estate and make sure that they are fully prepared for that responsibility if you pass away. The executor will be given control of your assets during the probate process and are responsible for collecting all assets, paying debts, and filing estate tax returns after you pass away. If you don’t choose someone that is responsible and ready to deal with these tasks, your family could run into big problems.
2. Not Fully Understanding the Estate Plan
Talking about your own death and what will happen to your assets after you pass away can be a stressful and unpleasant experience. This can lead to people being reluctant to dive deep during the estate planning process. Try to avoid the temptation of just letting your estate planning lawyer handle everything for you. It should be a collaborative process. It’s important that you are active in the estate planning process and that you fully understand every aspect of your plan to assure that your final wishes are met. One common pitfall we see is when people sign documents and agree to things without understanding what they truly imply. This can lead to misunderstandings and other issues later on down the road.
3. Avoiding Estate Plan Updates
As we mentioned earlier, it’s very important to update your estate plan every 3 to 5 years. Tax laws are constantly changing, which means you need to stay on top of them to avoid losing significant amounts of your estate due to taxes. It’s also a good idea to review your beneficiaries and make sure that the people specified in your will are the right choices. People change over time, which is why updates your estate plan is so important. Don’t fall into this common pitfall, or your family might suffer later on down the road.
We hope this article has provided you with some valuable insight into how to avoid common estate planning pitfalls. Remember that working with a professional estate planning attorney can make all the difference in the world. Contact Derryberry & Associates LLP for a consultation or if you have any questions about the estate planning process.