Sometimes people make errors of commission or omission that come back to haunt them or their families. We would like to take a look at three common estate planning errors in an effort to bring them to your attention so you can take steps to avoid them.
1.) The Creation of a Do-It-Yourself Estate Plan
This is an error that is becoming increasingly common in the age of the Internet. Doing things for yourself can be personally rewarding, and it can sometimes save you money. However, you have to know where to draw the line because sometimes Do-it-Yourself activities can wind up costing you more money than you thought you were saving.
Don’t take our word for it. Last year Consumer Reports examined Do-it-Yourself estate planning, and this highly respected independent source advised people to steer clear of generic template estate planning documents.
2.) Overlooking Viable Possibilities
Some individuals decide that they are going to execute a last will without knowing all of the facts. In truth, there are a number of reasons why you may want to arrange for future asset transfers via the creation of a revocable living trust rather than a last will.
Contrary to a popular misconception these trusts are valuable to people who would not consider themselves to be extraordinarily wealthy.
3.) Failing to Plan for Possible Incapacity
People are living long lives these days, and over 40% of people who are at least 85 years old have Alzheimer’s disease. This is not the only cause of incapacitation, so the possibility of someday being unable to make your own decisions is a very real one.
A court would appoint a guardian or conservator to act in your behalf in the event of your incapacitation if you do not name your own hand-picked decision-makers through the execution of durable powers of attorney.