By: Peak Legal Group January 11, 2024

Avoiding Common Estate Planning Mistakes: Tips From a Lawyer

Can You Handle Estate Planning On Your Own?

Estate planning is an essential step for anyone hoping to safeguard their assets, their families, and themselves. This process will ensure your wishes are known and respected. Unfortunately, there are some common estate planning mistakes that can prove disastrous to your overall plan. This is important to remember if you’re considering doing your own estate plan.

There are plenty of “do-it-yourself” options online these days. However, most legal professionals advise against them. That’s because an accidental error can easily go unnoticed, and by the time it’s discovered, it’s often too late. This is why official federal government resources advise working with an estate planning lawyer. Failing to do so can be a major mistake.
So, what else can you do to avoid serious errors?

How to Avoid Common Estate Planning Mistakes

Fortunately, seeking legal assistance is an easy way to avoid most misunderstandings, oversights, and mistakes. However, it’s still contingent on each individual person to practice vigilance during planning. Here are a few ways to accomplish this:

Don’t Procrastinate

If you speak to any estate planning lawyer, they’ll tell you that procrastination is one of the biggest mistakes people make. If someone dies or suffers an incapacitating injury, they’re no longer in a position to make important decisions. In most cases, this means the state will make them for you.

Understand Your Estate Planning Needs

People commonly don’t understand just how broad their estate planning needs are. Depending on your assets, family dynamics, state laws, tax implications, and many other factors — you may benefit from estate plan tools that others would never need. Understanding your situation is critical to doing things right.

Don’t Overlook Small Assets

Far too many people fail to consider small assets that may have sentimental value in their estate plan. For instance, Grandma’s old ring may only appraise at $40. However, it’s easy to envision a situation where surviving loved ones end up fighting over the family heirloom.

Make Sure You Have a Will or Trust

There are many legal tools a person can use for their estate planning needs. However, wills and trusts are the very foundation of estate plans. Without them, other strategies may prove less effective or even nullified. If you do nothing else, at least create a will or a trust.

Make Updates to Your Estate Plan

An estate plan can help you stop worrying about “what ifs.” However, it’s important to understand that things change. That’s why you should periodically review your estate planning documents and make changes when necessary.

Take Digital Assets Into Account

It’s easy to focus on finances and properties when planning out your estate. However, nearly everyone has a digital footprint in the modern world. Make sure you plan out what happens to your social media and other digital assets once you’re gone.

Plan for Potential Incapacity

Most people understand the importance of planning for their potential demise. However, far fewer people think of planning for incapacitation. If you suffer a serious injury, you may be unable to make important decisions on your own. Proper estate planning can help make these decisions in advance.

Don’t Overlook Your Beneficiary Designations

Did you know that assets like bank and retirement accounts can potentially avoid probate altogether? A critical step in asset protection is designating beneficiaries on your accounts. If you pass away, the people you choose will have access to your assets without any major headaches.

What Estate Planning Documents Do You Need?

The importance of understanding your estate planning needs cannot be emphasized enough. However, it’s common for regular folks to not recognize all the options available to them. The simple fact is that this is a complex area of law, so it’s no surprise that common estate planning mistakes are so prevalent.

Fortunately, knowing the following options can go a long way in preventing such mishaps:

Last will and testament
Revocable living trust
Durable Power of Attorney
Healthcare proxy
Living will (advanced healthcare directive)
HIPAA authorization
Digital asset plan
Financial inventory
Letter of instruction
Guardianship designations
Trust certificates
Beneficiary designations
Codicil (i.e., changes to your will)
Funeral and burial instructions

There is clearly a wide array of estate planning documents that should be considered. In fact, this list is far from exhaustive. There may be other important processes not listed here that could prove invaluable to your estate plan. Fortunately, you don’t have to figure out such issues on your own. An experienced attorney can assist.

What’s the Next Step in Estate Planning?

The most important step you can take in estate planning is to simply get started. We’ve discussed the dangers of procrastination, and while other common estate plan mistakes can cause issues, a failure to act is clearly the most disastrous. Things happen unexpectedly in life, and you don’t want decisions ripped away from you during these times.

The best advice anyone can get is to speak with a legal professional about their estate planning needs. There are law firms that offer flat fee services — which means there are no surprise charges — and it’s even possible to find attorneys who provide free consultations. Peak Legal Group is one of these firms.