Common Pitfalls for Those Planning Their Estates
While no one enjoys considering their eventual demise when creating a will, one way or the other, your estate will be distributed—either by you through your own advance planning, or by the government. If you’ve created a will to allocate your assets upon your death, then you’ve already avoided the biggest estate planning mistake you can make, which is failing to make one at all. Read on to discover other ways that you can negatively affect your heirs when planning your estate.
Putting a child’s name on a deed or account
While you may wish to save your children from the trouble of probate and ensure that large assets like a home or savings account will immediately be considered theirs, using this method to transfer property can cause your heirs more hassle than you may realize, or simply lead to a bad result. For example, listing a child on the deed to your home can result in a substantial tax burden and a great deal of hassle for your child. Additionally, adding your child’s name to a bank account can result in a tax burden, in addition to the risks inherent in awarding a large sum of money to someone who may not have the maturity to handle such a gift.
Failing to periodically review your estate plan
A will isn’t meant to be drafted once, then tucked away until you pass away. Many things can and will change in the interim—you may acquire additional property, have more children, or marry someone with children from a prior relationship whom you wish to treat as your own. You may also wish to disinherit someone after a relationship decays or that individual becomes financially secure. If you relocate to a new state, the laws affecting your estate plan may result in a need to make changes in order for the document to continue having your desired effect. Periodically take time to review your will with your attorney to ensure that it includes all relevant assets and parties. While doing so, use the opportunity to review the beneficiaries listed on your retirement accounts and life insurance policies. These beneficiaries will not automatically change to reflect the heirs listed in your will, and must be changed manually.
If you are creating or updating your estate plan in the Hudson Valley, contact the experienced estate planning attorneys at Rusk, Wadlin, Heppner & Martuscello for assistance with your estate plan at 845-331-4100 in Kingston or in 845-236-4411 in Marlboro.