AppId is over the quota
April 21, 2012 /24-7PressRelease/ -- Avoid These Mistakes When Creating or Updating an Estate Plan
Few people like to think about death, and planning for a time for after they have passed on often gets put off "for another day." When people do get around to making estate plans, they often end up making some common errors that leave their heirs in as poor of a condition as if they had not planned at all. People should avoid some of the following recurring estate planning blunders.
Not Naming Beneficiaries
The biggest mistake people can make in estate planning is not to have a plan at all. Some people assume that they do not have enough money to warrant making an estate plan, but even small and medium-sized estates require planning. If a person dies without a will, then the state's intestacy laws will determine which of the person's surviving relatives get his or her property, not the individual.
Another common mistake is to have a will that conflicts with beneficiaries that a person has named on non-probate assets such as life insurance policies and retirement accounts. For example, a person could intend all of his or her assets to go to a current spouse, and state that intent in a will, but still have a former spouse listed as a beneficiary of a non-probate asset. The will does not control the non-probate asset, so the wrong person may end up getting the asset if a person does not update beneficiaries regularly.
Leaving No Instructions for Spending Money
Many people want their heirs to use their inheritances for specific purposes. Common examples include college tuition or living expenses for those with special needs. They may indicate their wishes to their heirs but fail to put any formal restrictions on how heirs can spend the money. The way to avoid this pitfall is to create a trust with directions for the trustee to allocate the money for specific purposes.
Ignoring Tax Issues
Tax issues regarding inheritances can be complicated. Tax rules and penalties for retirement accounts can also be complex. If people do not factor in taxes their heirs may owe on inheritances when making estate planning decisions, they may end up leaving their heirs with nothing more than tax obligations. People can take steps to avoid estate taxes, such as making lifetime gifts or charitable donations.
Planning Without Professional Advice
Trying to make an estate plan without the input of professionals such as attorneys and financial advisors exposes a person to potential problems. Professionals can advise on the most efficient way to pass along assets, reduce tax liabilities and make sure documents such as wills and trusts comply with the laws.
Article provided by Gemma Law Office, P.C.
Visit us at http://www.gemmalawoffice.com
---
Press release service and press release distribution provided by http://www.24-7pressrelease.com
# # #
Read more Press Releases from FL Web Advantage:View the original article here
No comments:
Post a Comment