8 Common Estate Planning Mistakes and How to Avoid Them

Are you part of the 58% of Americans who don’t have a will? 

While thinking about and planning for what happens after you die can be uncomfortable, it’s important not to put off estate planning. 

However, you want to make sure you do it carefully, so you don’t make estate planning mistakes that could complicate matters for your loved ones after you pass away. 

So, how can you make sure you do all the right things when writing a will and planning what happens after you die?  

Keep reading for an overview of 8 common estate planning mistakes, and how to avoid making them. 

1. Putting It Off

The number one mistaking you can make in terms of estate planning is simply avoiding it.

If you pass away before you put together a plan for what happens to your assets, you’ll be leaving your family to deal with a significant amount of emotional strain. And that’s on top of the emotional toll of grief following a death. 

If you don’t think you need to bother with estate planning because you just assume that your assets will be left to your spouse or children, that’s not always the case.

Laws vary per state if you die without a will, so the best thing to do is to make it very clear what you want to happen after you die, and get it in writing. 

2. Not Setting Beneficiaries Correctly

As part of the estate planning process, you’ll need to set beneficiary designations on all relevant policies. This includes things like retirement plans, life insurance policies, military pensions, etc. 

However, choosing a beneficiary is just the first step. You’ll also need to set an alternate beneficiary, should your primary beneficiary die before you do.

And, you can’t forget to update your beneficiaries as your life circumstances change over the years. For example, if your spouse is your primary beneficiary, and you get divorced, you may want to set a new beneficiary. 

Or, if your parent is an alternate beneficiary and they pass away, you’ll need to adjust your estate plan accordingly. 

3. Not Signing a Health-Care Directive

An unfortunate part of the estate planning process is thinking in terms of worst-case scenarios. 

For example, what happens if you suffer a severe medical emergency and you cannot make decisions for yourself?

If you don’t have a signed health-care directive in your estate planning documents, your loved ones are left to make difficult decisions about life support, organ donation, and more. 

By making your wishes clear for what you want to happen in the event of a medical emergency, things will be much easier for your family. 

4. Ignoring Tax-Saving Opportunities

Some clients can take advantage of several tax-saving opportunities to help lessen the impact of any estate taxes that might be due after passing. 

In your estate plans, classify certain items as gifts, whether to groups, businesses, or individuals. Qualifying gifts, up to $15,000, can be excluded from estate taxes. 

Another way to save on estate taxes is to use the federal exemption option for each spouse. 

The surviving spouse can pass their deceased spouse’s unused federal exemption to themselves, essentially doubling the exemption amount for which they qualify. 

However, you must make sure you do everything regarding taxes in compliance with the law. Work with an estate planning attorney to ensure that you do everything correctly. 

5. Not Planning for the Unexpected

When creating estate plans, you must think about and plan for all unexpected situations. You’ll want to name powers of attorney, should something happen to you where you can no longer make decisions for yourself. 

If you have young children, the last thing you want to think about is missing out on a lifetime together. However, it’s better to be safe than sorry, by choosing a legal guardian should something happen to you and your spouse. 

You never know what might happen in your life, so it’s best to include plans for all scenarios when estate planning. 

6. Taking a Set It and Forget It Approach

If you’ve already done your estate planning, that’s great! However, the work doesn’t end there. 

Estate planning is not a one-time-only event. As your life changes, your estate plans should change along with it. 

For example, your plans will likely change as your family changes, whether in the form of marriage, divorce, remarriage, or having children. 

Similarly, if you move to a new state, there may be laws that impact your estate plans that weren’t in place in your old state. 

It’s a good idea to revisit your estate plans once a year or so, to verify everything is up to date. 

7. Picking the Wrong Person 

Choosing a personal representative for your estate is an important decision. You want to make sure you don’t select someone who could have ulterior motives. 

When making a decision on who should be your personal representative, try to think about someone who is good at making decisions emotionally and someone who is reliable. 

You should also choose someone who is in good financial standing and who can handle the responsibility that comes along with being a personal representative.

Once you’ve made a decision make sure to talk it over with the person you choose to make sure they are comfortable with your decision. 

8. Not Working With Professionals

You don’t want to take any chances when it comes to planning your estate and preparing your will. 

Hire an attorney who specializes in estate planning to make sure nothing is overlooked. This helps to ensure that your wishes are documented correctly and there will be a lower likelihood of complications when you pass away. 

Talking to a financial planner and tax professional can also help you when estate planning.

We Can Help You Avoid Estate Planning Mistakes

Our lawyers at Watertown Law are here to help you avoid all the estate planning mistakes listed above. 

You can’t afford to put off your plans any longer. Reach out to our team today to take the first step in making the right preparations. 

6 Factors to Consider When Choosing a Real Estate Lawyer

If you’re looking for a real estate lawyer, it is important that you don’t hire just anyone. When it comes to handling major transactions such as the purchase of a property, you need to ensure you have the right support behind you. 

When it comes to buying real estate, you need someone by your side that has your best interests at heart. 

But what should you consider when you’re looking for a real estate lawyer?

Here are six factors that you really need to think about when choosing your attorney. 

1. Do They Have Knowledge of Transactions in the Local Area?

Different housing markets move at different speeds, and what happens in the area may not happen in another. When it comes to hiring a real estate lawyer you need someone who has a clear understanding of what can affect transactions in the area that you’re buying. 

Local building codes will differ between towns and cities and you’ll want someone on your side that has a good handle on the issues that you may face with your property. 

In addition to finding a lawyer who knows the local housing market well, you’ll also need to think about getting a lawyer that has helped close similar properties to yours. If you’re buying an apartment, it may be helpful to have a lawyer that has worked on other property deals on the same block. 

2. How Much Does the Real Estate Lawyer Charge?

Before you decide on which real estate lawyer to go with, you’ll want to know exactly how much they will charge you for their services and what the closing fees will be. Comparing lawyer fees is essential when deciding on a real estate lawyer. 

The fees that you’ll need to pay will largely depend on the complexity and the size of the transaction.

The following factors will affect how much your fees will be: 

  • Whether you are buying or selling
  • Whether the sale is made in cash or whether you’ll need a mortgage
  • If you are borrowing money whether the lender is an institutional or a private lender
  • Whether you need to pay federal or state tax withholdings
  • If there are any expected issues 
  • Whether the sale includes anything out of the ordinary in the buying process

Find out as much as you can about the way that the fees work before you decide on your real estate lawyer. 

3. Will You Get Personalized Attention?

Every property buying transaction is different, and you don’t want to choose a real estate lawyer that uses a copy and paste approach to dealing with property purchases. 

A good real estate lawyer will prove you with personalized attention and will be able to provide you with answers to any questions that you may have as they come up.

Having a good connection with your lawyer is essential. Without this personalized attention, it can be difficult to build up the trust and respect that you’ll need to have in your real estate lawyer. 

4. Will You Get Support Throughout the Entire Transaction?

Handling real estate sales can be a long and complicated process. You need to know that you’re going to have a lawyer that will help you out throughout the entire process. 

Talk to your lawyer to find out exactly how they envisage the transaction going. Find out how often you’ll receive updates from them throughout the process. 

If you need to get in touch with your lawyer, how easy will this be? 

5. What is the Lawyer’s Track Record Like?

Talk to your lawyer to find out about their previous track record. How have they performed previously when closing? How much experience do they have in real estate?

Many lawyers will have multiple specialties. Find out how long they have been handling real estate work and what experience they bring to the table. 

6. How Will Your Lawyer Communicate? 

Find out how your real estate lawyer will communicate with you throughout the process and make sure that it matches your needs. 

If you’re busy, you may want to receive communication via email or text message. However, if you are likely to have questions to ask, hearing from the lawyer over the phone may suit your needs better. 

Finding the Right Real Estate Lawyer

If you are buying or selling a property and you need the help of an experienced real estate lawyer, we can help. 

Here at Neuberger, Griggs, Sweet, and Froehle we have a wealth of experience in helping with a range of real estate issues. 

Get in touch today to find out how we can help.