subject: Estate Planning Mistakes That Can Cost You [print this page] Estate Planning Mistakes That Can Cost You
When you work hard your entire life to build your wealth, you usually want your family to be able to enjoy the fruits of your labor once you are gone. When you make mistakes in estate planning, your family could get much less of your estate that what you would like them to have.
The reason that this happens to some people is because when they were putting together an estate plan, they made mistakes that ended up costing their family later. To keep this from happening to your family, here are a few estate-planning mistakes that you will want to avoid.
Writing Your Own Will For most people, the do it yourself wills that you can find online, do not cover everything. If you want to make sure that your wishes are known and honored after your death, you will want the help of an expert, estate planning attorney to write your will. If you do insist on drafting your own will, you will at least want an attorney to review the document so that you can be sure that you have all of your bases covered.
Not Including Your Business in Your Estate Plan Though it may be uncomfortable to talk with your family about how you would like the family business divided, it is vital that you do so. This way you can be sure that all of your kids understand how you wish the business to be divided, and the reason behind your decision. To keep your business alive for future generations, it is also important that you look for ways within your estate plan to reduce your estate tax. If your tax is too high, your family could be forced to sell the business to pay taxes.
Not Using a Trust In a lot of cases it is better to leave money to your family through a trust instead of in a lump sum. This is especially true if you do not feel that certain family members would use the money wisely. With a trust you can leave instructions on how the money is to be used and help prevent your family member from going broke soon after they inherit.
Forgetting to Update Your Estate Plan Life is always changing and for this reason your estate plan will likely change a number of times over your lifetime. If you forget to update your estate plan, it could cause your family a lot of problems later. Not only should you review your estate plan every few years to make sure that there is nothing you are forgetting, but whenever there is a life changing event, such as a marriage, birth of a child, divorce, etc.
Avoiding mistakes with your estate plan may cost you a little more now, but it can save you, as well as your family a lot of money and disappointment later.
