Although none of us like thinking about the fact that someday we will pass on, it is a reality that all of us must face. So in order to make the grieving process easier on our family members, it’s important that you write out a will and do a bit of estate planning as well.
When it comes to getting your estate in order, there are a lot of benefits that come with doing it. Planning your estate lets you decide who gets your assets. It can minimize some of the taxes that your beneficiaries will receive. It also can protect your children’s inheritance should your spouse decide to get remarried.
If knowing all of this information has convinced you to do some estate planning over the next few months and you want to make sure to prepare it properly, here is a list of five common mistakes that you should avoid.
Not coming up with a plan. When there is no plan in place and death occurs, it only causes more confusion for those who are left behind. And yet, there are literally millions of people who do not have an estate plan. If you are one of those individuals, it is crucial that you make the time to put one together. One website that can assist you with the proper steps that you need to take is Nolo. Go to the site and put “steps to an estate plan” in the search field.
Not updating your will. If you’ve already started the process of putting a will together, that’s awesome. In many ways, you’re already ahead of the game. However, it’s important to keep in mind that as your life changes, the conditions of your will may too. That’s why it’s a good idea to look it over once a year – just in case you want to make a few updates.
Not researching the cons of putting your child’s name on your house deed. Although it might initially seem that putting your child’s name on the deed of your house is a noble gesture, here is the challenge: anything that is worth more than $13,000 is taxable. And so, when it comes to something as expensive as a home, it could end up adding more stress to your child than anything else. It’s actually better to offer them an inheritance with a value equal of the house instead.
Not transferring your life insurance policy. Suppose that you decided to consult with a law firm like Evans Petree PC in order to get some estate planning tips. One thing that they might mention is if you don’t make a point to transfer your life insurance policy over to a life insurance trust, the IRS could end up seeing more of the money than your beneficiaries. For more information on life insurance trusts, visit Wills and Probate and put “life insurance trust” in the search field.
Not meeting with a professional. No matter how many books you may read or information you may find on the internet, it’s still wise to meet with a professional who specializes in estate planning. Whether it’s a lawyer, a financial advisor, or a tax accountant (or all three), speaking with someone about your estate can reduce the time it takes to get your plans in order. Plus, it can provide you with peace of mind.