Estate Planning

How to Avoid Common Estate Planning Mistakes

It’s far too easy to make mistakes when developing an estate plan. And even minor mistakes can affect how your assets are handled. In this case, you must be aware of the most common mistakes to ensure that your plan is accurate and binding:

• Forgetting Secondary Beneficiaries – Secondary or contingent beneficiaries are people you name in your will in addition to primary beneficiaries. If a primary beneficiary dies before assets are distributed, the secondary beneficiary will receive said asset.

• Neglecting Disability Planning – Disability planning ensures you have access to the right medical care in the event you become incapacitated by illness or injury. In this case, a revocable trust can ensure your finances are well managed when you’re incapable of doing so.

• Selecting the Wrong Executor – An executor has lots of responsibilities, so it’s important to choose a trustworthy and reliable person to carry out the task. You can choose family members, friends, co-workers, or even financial institutions.

• Failing to Update Your Plan – Your estate plan must change as your life does. For instance, it’s best to review the entire plan after a new marriage, divorce, the birth or adoption of a new child, or drastic changes to your finances. 

It’s also a good idea to review your estate plan every three to five years to ensure it still meets your needs.