An estate plan allows you to state your wishes regarding your assets, your health and the future of your minor kids if you have any. However, it may fail to protect you and your loved one as intended if you are not careful.
Outlined below are two common estate planning errors to be aware of:
Appointing the wrong parties
It’s vital to consider certain factors when picking an executor, a trustee, a power of attorney, a health care proxy and/or a guardian. For example, an executor or a trustee should be willing, responsible, trustworthy, financially stable and assertive. A health care proxy should be willing to make hard choices, pay attention to details and be decisive. Your child’s guardian should share your values, be financially stable, be patient and possibly live near you and so forth.
Having the right parties involved in your estate plan will help ensure that your wishes are honored.
Failing to update your documents
Your estate planning documents should reflect your current life. If you move to a different neighborhood or city, your documents should have the new address. If you move to another state, your documents should reflect that state’s laws. If you get married, remarried, or go through a divorce, make the necessary changes to your documents.
Other life changes that may call for an update include the birth/adoption of a child/grandchild, a purchase/sale of an asset, the death of someone included in the estate plan and the resignation/removal of an appointed party.
You don’t want your loved ones to submit an outdated estate plan to probate. And when you update your documents, consider informing your executor or trustee.
Your estate plan should be binding. Legal guidance can help you draft documents that will ensure your wishes are fulfilled.