When you take the time to construct a thoughtful estate plan, you can enjoy the benefits of financial security and peace of mind. Admittedly, most people might not devote a lot of time to contemplating the financial impact of a serious illness, fatal accident, or debilitating injury because these are not matters people want to dwell on. However, unexpected incidents can arise that make it important to have an effective estate plan. This blog provides examples of some common estate planning mistakes.
Failing to Include Necessary Estate Planning Tools
Some people will draft a power of attorney to authorize a person to sign a document or create a last will and testament to provide for the disposition of the assets of his or her estate. While these documents can be vital components of a comprehensive estate plan, the creation of isolated estate planning devices ignores the importance of a comprehensive strategy to address the many issues affected by an estate plan. The most basic estate plan should include the following:
- Financial power of attorney
- Revocable living trust and will
- HIPPA authorization/waiver
- Healthcare power of attorney or advance directives
Relying on DIY Solution Rather Than Estate Planning Professional
The market is inundated with self-help estate planning options that include software programs, pre-printed forms in stationery stores, and legal document websites. Alternatively, many non-professionals offer document preparation services though they do not have legal training or expertise in property law, tax law, wills and trusts, and other areas of law. Our Columbus estate planning law firms often hear from individuals and families after their decision to trust unreliable resources leads to unintended consequences. For example, many people who rely on document preparation services to draft a living trust never take the appropriate steps to fund the trust. Alternatively, documents might be executed improperly. If a person makes either of these mistakes, the estate planning document could be completely ineffective. An experienced estate planning lawyer possesses knowledge in the wide range of areas of law relevant to a comprehensive estate plan and understands all of the intricate parts of an estate plan necessary to prevent unintended outcomes.
Viewing Estate Planning as a Task Rather Than a Process
When people view estate planning as a finite task, completion of a document or several documents might be considered the culmination of the creation of an estate planning. Properly viewed, the estate planning process is an ongoing process. The maximum benefit of an estate plan can only be achieved by periodically reviewing and revising estate planning documents in response to major life events and changes in the legal environment. Significant developments that might merit a review of your estate planning documents include:
- Adoption or birth of a child or grandchild
- Change in employment
- Responsibility for new dependents
- Formation of a business
- Purchase of a large asset like a residential or commercial property
- Change in financial goals
- Illness or disability of your spouse
- Incurring a significant liability
- Disability of a child or grandchild
- Substantial changes in net worth
- Passing of a spouse or child
These are only a few examples of the types of significant life events that might justify updating your estate plan. Even in the absence of such changes, an estate plan still should be re-evaluated on a periodic basis.
Our Columbus estate planning attorney at Dawes Legal, LLC can offer assistance with specific estate planning documents or a comprehensive estate planning experience. We invite you to call us today 614-733-9999.