Benjamin Franklin once stated that “by failing to prepare, you are preparing to fail.”  This adage holds true in terms of estate planning.  By failing to engage in quality estate planning, you may fail to leave your estate to your loved ones on your terms.  Most of us engage in all kinds of planning throughout our lives.  We plan educational paths, careers, budgets, family trips, weddings, and other various events.  Yet many overlook planning the distribution of their estate to their descendants once they are gone.  This is one of the most important planning events in our lives.  It is the process of planning how our loved ones will remember us once we are gone.  As you take the steps to create your own estate plan, keep in mind the following common estate planning mistakes.  These mistakes can create an estate plan that is destined to fail.

The first mistake is failing to spend the time and money to create an estate plan that is customized to you and your family’s needs.  The costs of settling for a cheap, cookie-cutter estate plan may greatly outweigh the costs of doing it right the first time.  Many times a non-customized estate plan must be fixed because it fails to capture an individual’s needs, or worse, it is so poorly drafted it triggers probate.  This leads to the second mistake: hiring a non-qualified individual or entity to create your estate plan.  You should always hire a recommended and experienced attorney that is an expert in estate planning.  A good estate planning attorney will understand the available estate planning options for every situation and will be able to mold your estate plan around your situation.

The third mistake is picking the wrong fiduciaries or executors to oversee your estate. Make sure your choice is an individual with the capacity and willingness to carry out your estate plan. The fourth mistake is failing to properly fund your trust.  Make sure you have assigned all your real estate holdings, property interests, bank accounts and brokerage accounts to your trust.  Failure to do so could trigger probate and a long legal process for your loved ones to suffer through.  The fifth mistake is complacency.  Once you have created an estate plan, the process is never complete. The reality is that most individuals’ lives are constantly changing.  Estate plans are capable of changing along with your life, as long as you make the effort to update your estate plan.  Estate planning is an ongoing process and you should update your estate plan as your life changes.

For additional reading:

The Heartache of Poor Estate Planning

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