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Three estate planning mistakes to avoid

On Behalf of | Mar 25, 2022 | Uncategorized

Estate planning performs a number of important functions, from taking care of loved ones to making your wishes for future medical treatment clear. An effective estate plan should leave you with the peace of mind that your wishes will be carried through no matter what the future holds. On the other hand, mistakes in the estate planning process can leave important things to chance. Here are three estate planning mistakes to avoid.

Choosing the wrong power of attorney

A power of attorney can perform a number of functions on your behalf, from conducting financial transactions for you to making important health-related decisions in the event you cannot make them for yourself. Before handing over such responsibilities, ask yourself if the person you have in mind:

  • Can be trusted to make decisions that only benefit you, and not to seek personal gain
  • Lives near enough to conduct business in your local area
  • Is strong-willed enough to stand up for your interests if they encounter disagreement with a family member or other party

You might have to take a coolheaded assessment of a candidate’s personality, morals and temperament before choosing a power of attorney. Once you have made that decision and you know it’s the right one, you will be glad you didn’t rush into it.

Failing to update the plan

If you created an estate plan years ago, you may want to consider if the legal plans you laid down then still reflect your wishes. Many life events can create the need for revising an estate plan, from adopting a child, to getting divorced to experiencing a dramatic change in financial circumstances. By reviewing your old estate plan, you can determine if revisions to your will, trusts, powers of attorney and other documents are needed.

Misreading your beneficiaries

You may want to leave the family business behind to all your children, but what if only one of them is truly interested in running it? Or perhaps you have a house you want to leave behind, but only one of your children wants to live in the local area.

Before establishing plans, you should not only think about what is fair and equal for your heirs and beneficiaries but also what they want. This may require giving one asset entirely to one child while compensating the others with some other property. Whatever shape your estate plan takes, it is likely your loved ones will appreciate the care and attention to detail you put into it.