3 Common Estate Planning Mistakes to Avoid
A thoughtful estate plan provides significant peace of mind that the plan protects you and your loved ones for the future. Unfortunately, estate planning mistakes can completely undermine the legal protections that a solid estate plan provides. Read on to learn about the three most common estate planning mistakes to avoid.
Mistake #1: Thinking that you do not need an estate plan.
Many people do not have an estate plan because they think they do not need one. The reasons vary greatly, but regardless of the rationale, reaching that conclusion is a serious mistake. Everyone should have an estate plan, no matter how much they own, what family or loved ones they have (or don’t have), how their assets are titled or held, or any other factor.
If you do not create your own estate plan, Arizona laws effectively put one in place for you. When you don’t have a valid estate plan, state laws determine how your estate is distributed when you die — and state laws may not distribute your estate in the way you want. They also determine who can (and cannot) make your personal, medical, and financial decisions if you become temporarily or permanently unable to make them yourself, due to medical issues, an accident or injury, or another cause. Without the right legal documents in place, a court may give control over important decisions to someone you would not want to have that authority — or make it impossible for a loved one to make critical decisions in a timely manner.
When you create an estate plan, you make all those essential determinations on your own terms. You distribute your property as you see fit. You decide who has legal authority to make personal, medical, and financial decisions on your behalf if you become legally incapacitated. Estate planning documents accomplish much more than many people realize. They protect you and your family during your lifetime, in addition to implementing your wishes after death.
Mistake #2: Using the do-it-yourself approach to make an estate plan.
The DIY, do-it-yourself approach is an effective way to accomplish many tasks — but estate planning is not one of them. Establishing an estate plan is a serious undertaking that should never be attempted without assistance from a knowledgeable attorney. There are many significant risks to DIY estate planning.
The ready availability of legal forms and internet services may make it tempting to save money by creating an estate plan on your own. The problem is that making legal documents without advice from a lawyer can create substantial legal issues that cannot be easily resolved or will not be identified until it is too late to fix them.
DIY documents may be unsuitable for your personal and financial circumstances, may not accomplish what you think they do, or may be invalid in Arizona. Inconsistent documents and incomplete estate plans are other frequent issues with do-it-yourself estate planning efforts. There are so many potential problems with a do-it-yourself estate plan that the long-term negative implications simply are not worth the relatively small amount of money you may save with the DIY approach.
At Peterson Law Offices, we provide no-cost, no-obligation initial consultations for all our services, including estate planning. You should not hesitate to talk with us about creating or updating your estate plan before you decide how to proceed.
Mistake #3: Forgetting to update your estate plan.
Estate planning is not a one-and-done task. Along with the great sense of accomplishment that comes with making an estate plan, there is an ongoing responsibility to keep the estate plan up to date. People who create an estate plan often forget to update it to reflect changes in their lives.
Many life events create the need for revising an estate plan. It is easy to get caught up in day-to-day life and not consider the implications that changes in your life have on your estate plan. Updating your estate plan is essential not only when beneficiaries change, but also when it becomes necessary or appropriate to make changes in a fiduciary, such as an executor, trustee, or an agent under one of the durable powers of attorney. Changes in your property and assets can also significantly affect your estate plan and require making revisions.
While some estate planning attorneys suggest reviewing your estate plan every three to five years, a better approach is to make an annual assessment. The beginning of a new year or tax time (when you are already working with your finances) are logical choices for going through a quick mental checklist to review whether any changes within the last year necessitate updating your estate plan. If your estate plan does not reflect your current personal, business, and overall financial circumstances, it is time to call your attorney and schedule an appointment to review your estate plan.
Schedule a Free Consultation With an Experienced East Valley Estate Planning Attorney
At Peterson Law Offices, estate planning is a primary focus of our practice. There is no charge for your initial consultation with us. We provide top-quality services at affordable prices and welcome inquiries from clients throughout the East Valley, including Queen Creek, San Tan Valley, Gilbert, Mesa, and Chandler. Schedule your free initial consultation by calling 480-878-5998 or using our online contact form.