Ten Common Estate Planning Mistakes to Avoid

Many misconceptions exist regarding estate plans, but having a solid understanding of what they are and how they can benefit you could make a considerable difference for your family and loved ones after you die. The following are the 10 most common misconceptions and mistakes people make. Speaking with a knowledgeable Sacramento estate planning attorney can clear up any other misunderstandings.

1. Having no estate plan at all means that there will be no clear means of handling your health care or assets if you become incapacitated or when you inevitably pass away.
2. Failing to update your will for major events such as births, deaths, divorces, and new asset acquisitions can leave their future in jeopardy once you pass away.
3. Not planning for a disability can also leave in doubt who will handle your finances, raise your children, and manage your healthcare decisions if you are unable.
4. Not making gifts to lower your estate tax is a common mistake but you should know that gifts to individuals, groups, or business are subject to a $26,000 estate tax savings.
5. Putting your child’s name on the deed which essentially gives your child a large taxable girl which could mean a lifetime of financial headaches.
6. Choosing the wrong person to manage your estate can mean your assets are handled poorly or improperly, putting them at risk.
7. Not transferring your life insurance policies to a life insurance trust can leave you liable to having to pay high estate taxes when you die.
8. Not taking advantage of the federal $675,000 exemption means you could lose the deceased spouses’ individual exemption.
9. Procrastinating can force you to miss out on the benefits of estate planning and cause undue stress in the event of a sudden and unexpected death.
10. Not meeting with a legal professional may be the most common mistake. An attorney can advise you of the strategies to preserve your estate you have available to you.