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5 Common Estate Planning Mistakes

Estate Planning spelled out in wood blocks in front of a city scape

It's common to make an estate planning mistake, and we see clients make a lot of the same ones. Here are five tips to help you avoid some of the most common pitfalls.

Estate Planning Mistake 1: Not Updating Documents

Some things in life are “set it and forget it.” For example, you probably don’t regularly check on your 401K allocations, and trust that it's performing how you want.

Estate planning is different.

Our lives are constantly changing, with new family members, moving, life changes, launching businesses, and more.

Because our lives are always changing, we need to regularly update estate planning documents like your will and your power of attorney. In general, updating it every 5-7 years (or during a major life event such as a family member’s birth or death) is a good idea.

Mistake 2: Not Using a Trust

Do you have a trust that you aren’t even putting assets into? It may sound silly but it happens a lot more often than you might think.

Just like a savings account or retirement account, a trust is something that people set up sometimes but don’t actually follow through with using. Suddenly it’s too late and it’s not useful anymore. If you have one set up, make sure you’re taking advantage of it!

Estate Mistake 3: Making Your Children Joint Owners of Your Assets

We know you love and trust your children, but don’t make them a co-owner of your assets. Instead, make them a beneficiary of your assets and give them power of attorney for when you pass away.

Why? Because you don’t want to open yourself to losing the assets because their creditors took it from you.

For example, let’s say you make your son a joint owner of your home. You figure when you leave this world, he’ll take it anyways, so why not just go ahead and sign it over to him?

The answer is because if he gets in financial trouble, his creditors will come after your home. Maybe he lost his job due to COVID and can’t pay bills anymore. Because he’s a joint-owner of your assets, the people he owes money to can come after your stuff.

Estate Planning Mistake 4: Not Naming Beneficiaries

When you sign up for a 401K, IRA, etc., it will ask you to name your beneficiaries. While this is easy to skip, it’s vital that you don’t. Just a few minutes of time can make things go much easier when you pass on. And make sure you update your list anytime there’s a change in your beneficiaries.

Mistake 5: Doing Nothing

This is the most common thing we see. Most people put more time into planning their annual vacation then what will happen to their assets when they pass away. Don’t let that happen to you!

Give us a call at 714-663-8000. We’ll do more than just help you avoid these estate planning mistakes - we’ll help you build a solid plan to make sure your loved ones are taken care of.


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