Hyden, Miron & Foster, PLLC Law Blog

Thursday, July 31, 2014

Common Estate Planning Mistakes

Most people would like to believe that once they pass everything will go as planned.  The truth is, no matter how well you are prepared, you cannot plan for every contingency.  However, you can reduce the risk that things will go off track by avoiding some common estate planning mistakes.

Often times, individuals choose the wrong people to manage their estates.  Picking the wrong executor or trustee can wreak havoc on your plan.  Remember, you do not have to settle for the default picks (such as a spouse or child). You should pick someone you can trust.  You should put a lot of thought into these selections and consider individuals who understand what you want and who are most likely to fulfill your wishes.  You can also pick multiple people, if you think that will work best.  But, be aware this could backfire and cause more harm than good.

In many instances, people do not consider the assets they possess that may pass outside their Will or Trust.  Assets such as retirement funds and life insurance policies will pass according to the beneficiaries you designate on these accounts.  You should think carefully about these designations and review them often.

Many do not consider the possibility that something might happen to the beneficiary they have chosen.  This risk is a real one and you should therefore designate secondary beneficiaries when possible.  Not designating secondary beneficiaries could cause this bequest to fall into the residuary estate and pass to someone you did not intend to benefit in such a way.  Choosing a secondary beneficiary or adding a contingency provision to your Will or Trust can help avoid your assets passing to someone to which you did not intend them to pass. 

Another common mistake is being secretive about your estate plan.  Talking openly and generally about your estate plan with your loved ones will eliminate surprises that could cause conflicts.  

Most estate plans provide protection in the event you become incompetent through the use of a financial and health care power of attorney.  Again, you must be careful when choosing these agents.  They must be aware of your wishes, have the ability to deal with others, and be trustworthy.  You should review your powers of attorney often, especially when relationships change.  

When creating your estate plan, talk with your attorney about all of the above in order to be as prepared as possible for any issues that might arise.  Contact the attorneys at Hyden, Miron & Foster, PLLC, at (501) 376-8222, today to discuss your estate planning matter.


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