Putting off your estate plan for another year isn't an option. Crossing off this important task is a great way to start 2018 with momentum, protecting your family and giving yourself peace of mind.
Undoubtedly, you understand the challenges involved in making your estate plan, and you want to make sure that all your effort is worthwhile. To assist you in this, estate planning advisors have some tips to help you avoid some common pitfalls.
Do the prep work
The more complicated your estate is, the more preliminary work you may have to do. For example, if you have significant debt or own complex assets like investment properties, you may need to decide how to handle these in your plan. Understanding the probate process and how it will affect your heirs may help you identify anything you may need to deal with as soon as possible. Although Texas has no state inheritance tax, you will also want to know if your estate qualifies for the federal tax so you can take steps to minimize the impact.
Once you begin your estate plan, advisors recommend you avoid these mistakes:
- Leaving assets directly to your children instead of protecting them through trusts
- Failing to properly fund your assets to the trusts
- Choosing your estate executor based on birth order instead of maturity and sense of responsibility
- Forgetting to revise beneficiary designations after significant life changes, such as divorce or the death of an heir
- Neglecting to establish and implement a business succession plan as part of your estate plan
One important factor that many overlook when making an estate plan is sharing that plan with their families. While it may seem like a romantic notion to surprise your heirs with a generous bequest, they may appreciate more the ability to participate in the planning stages, especially if their inheritance requires them to take on responsibilities or financial burdens, such as the deed to property or a stake in your business.
Carefully and thoroughly planning your estate may be intense and even frustrating, but with the help of a seasoned attorney, you can assure that every area of your estate will be properly addressed. Then you can proudly cross this item off your list of resolutions.