Estate planning is crucial to ensure that wealth accumulated over a lifetime is distributed according to your wishes and will take care of your family when you can no longer do so. Many well-intentioned people make common mistakes, which you can avoid with the guidance of an estate planning attorney, says the article “Avoiding Big Estate Planning Mistakes” from Physician’s Weekly.
Do you have a will? Many families must endure the red tape and expenses of “intestate” probate because a parent never got around to having a will prepared. The process is relatively straightforward: identify an estate planning attorney and make an appointment. Once the will is completed, make sure several trusted people, likely family members, know where it is and how to access it.
Are you adequately insured? If the last time you looked at your life insurance coverage was more than ten years ago, it’s probably not kept pace with your life. Although every person’s situation is different, high-income earners, like physicians or other professionals, need to understand that life insurance “replaces” income. This means enough to pay for college, pay off a mortgage and provide for your surviving spouse and children’s lifestyles.
When was the last time you spoke with your estate planning attorney, CPA, or financial advisor? Tax laws are constantly changing, and if your estate plan is not keeping up with those changes, you may be missing out on planning opportunities. Your family also may end up with a big tax bill if your estate plan hasn’t been revised in the last three or four years. Your team of professionals is only as good as you let them be, so stay in touch with them.
When was the last time you reviewed your estate plan with your attorney? If you thought an estate plan was a set-it-and-forget-it plan, think again. Tax laws aren’t the only thing that changes. If you’ve divorced and remarried, you need a new estate plan—and possibly a post-nuptial agreement. Have your children grown up, married, and perhaps had children of their own? Do you have a new and troublesome son-in-law and want to protect your daughter’s inheritance? All of the changes in your life need to be reflected in your estate plan.
Have “the talk” with your family. No one wants to think about their mortality or their parent’s mortality. However, if you don’t discuss your estate plan and your wishes with your family, they will not know what you want to happen. It doesn’t need to be a summit meeting, but a series of conversations to allow your loved ones to become comfortable with the discussion and make it more likely your loved ones will fulfill your wishes. The talk should include your estate plan and desires for burial or cremation and what kind of memorial service you want.
Reference: Physician’s Weekly (Oct. 8, 2021) “Avoiding Big Estate Planning Mistakes”