“Estate planning is done for a number of purposes. One is to transfer assets to your heirs, according to your wishes once you pass on. Unfortunately, just having the documents in place may not be enough, as mistakes can be made.”
WMUR provides some of the most common things to review within your own planning in its recent article, “Estate planning mistakes.”
Delay. The easiest mistake to avoid, and probably the biggest, is procrastination. Just doing nothing at all in your estate planning is a common mistake. If you fail to create a plan for yourself, the state may apply the intestacy laws and determine who will receive your assets and how they’ll acquire them. This might not be the plan you wanted.
Review. You should conduct a periodic review of your estate planning documents to be certain they still match your current wishes. There are changes that occur over time, like life circumstances and the estate tax laws. Be sure your chosen executor is still able to take on the responsibility.
Titles and Beneficiary Designations. The correct titling of your assets and up-to-date beneficiary designations are also areas where people commonly make mistakes. Update your retirement plan and life insurance policy beneficiaries, so these proceeds pass to the correct beneficiaries. An asset owned in joint tenancy with rights of survivorship will pass directly to the surviving joint tenant.
Trust Funding. Another common mistake is not funding your revocable trust. Perhaps you have a trust that accomplishes all that you wish. If you don’t fund the trust with assets, it’s of no use to you or your beneficiaries. Trusts are helpful when dealing with younger heirs, because a trust can control when the income can be received and for what purposes, until the beneficiary reaches a certain age or other milestone.
The Barry Manilow Records. Think about the disposition of family heirlooms, collectibles, and other items of sentimental value. You’d be surprised what siblings fight over, and sometimes the squabbles grow into all out fractures for families.
Passwords. Create a master document that has all your social media, online accounts, and passwords, allowing your heirs ready access to them to close them.
Location. Make sure that a family member knows where the documents are located at your passing. If your estate planning documents can’t be found, or no one knows that they exist, your plans probably won’t be executed.
Reference: WMUR (December 28, 2017) “Estate planning mistakes”