A new year is a great chance to get your estate plan taken care of. If you’re one of the adults who doesn’t have one yet, now is the time to put everything in writing so your loved ones know what to do when you pass away.
Creating your estate plan also provides instructions for making decisions on your behalf if you become incapacitated. It also enables your finances to be taken care of if you can’t do it yourself. Failing to create an estate plan is a huge mistake. As you’re creating your plan, be sure to avoid these mistakes:
#1: Failing to update your estate plan
Your estate plan isn’t a one-time-only affair. You need to review it periodically to be sure that it still reflects your wishes. Events in your life may necessitate changes to the plan. For example, you need to update it if you get married or divorced, have children, or experience a major change in assets.
#2: Naming assets more than once
Each asset should only be named in the estate plan once. Some assets, such as financial accounts, shouldn’t be included at all because they’re governed by the payable on death instructions that you set when you opened the account.
#3: Not setting appropriate designations
Be sure that you have the proper people named in the power of attorney documents. You need one for healthcare and one for finances. You also need to have someone named to administer your estate when you pass away.
The estate planning process doesn’t have to be difficult. You can work with someone who’s familiar with this area of the law so you can ensure that your rights are being respected. Be sure that you get your estate plan set as soon as possible so you can take care of your loved ones after you pass away.