Estate planning is not as simple as you may think. After all, you are trying to plan for the future that does not always go as you think it would, and you are trying to make sure that your current assets grow and are protected so that your beneficiaries will not be harmed by expensive estate taxes. However, even those with the best intentions may make mistakes in managing their estate plans. Through this post, we will highlight some common errors, so you won’t make them.
Thinking your will can do it all – A will is an important piece of any estate plan, but it is not supposed to be an exclusive tool. A will is supposed to set forth a framework for how the estate is to be distributed. Even with this, there are other documents or entities that must be created to manage assets so that they don’t have to go through probate.
Giving money too early to beneficiaries – Indeed, it is smart to establish trusts for children so that when they grow up, they will have money (and property) waiting for them. However, it is critical to consider not only their ages, but their respective development when it comes to dealing with money. Essentially, a 21-year old may not be so responsible with a great deal of money.
Choosing a bad trustee – Choosing a beneficiary may not be easy, but the person or entity chosen should have the beneficiaries’ best interests in mind. With that, choosing a sibling or other family member may create undue tension.
If you have additional questions about estate planning, an experienced attorney can advise you.