Common Mistakes in Estate Planning
There are a number of common mistakes people in California may make regarding estate planning, including assuming that they do not need to make a will at all. Some people may think they have too few assets to bother with a will, but even if their assets are modest, it is likely they have preferences about which family members will receive them. Furthermore, wills have other uses. People may use them to pass on personal items of little financial value, to appoint guardians for their minor children or to specify the type of funeral they want.
Some people may think they do not need to update their estate plan because they have not divorced or had more children. However, there are other reasons estate plans may need to be reviewed and updated. People who create an estate plan when they are younger may name a parent or someone near their own age as executor. However, as people get older, they might need to name someone likely to still be alive and to have the capacity to handle the administration. Tax laws may also have changed since an estate plan was made.
Another common error is failing to understand the role of beneficiary designations in an estate plan. Some assets do not pass through a will, so these forms must be completed even if a person has a will.
Some people who think they do have a simple estate plan might think they can use do-it-yourself forms. However, estate planning with the assistance of an attorney may help ensure that the estate planning documents do not contain errors that can make them vulnerable to challenges. An attorney might also suggest additional documents, such as powers of attorney for health care and finances in case the person becomes incapacitated.