STEVE RIDZON
STEVE RIDZON
Attorney Laura Curry
by Attorney Laura Curry
When thinking about creating your estate plan, it is important to avoid common pitfalls and mistakes. Creating a comprehensive estate plan can provide you with peace of mind and serve as a gift to your loved ones. You want to develop a plan that will safeguard your hard-earned assets and protect your loved ones in the event of your incapacity or death. Making sure you are aware of common estate planning mistakes means that you’ll be likely to avoid them. Here are the top five common estate planning pitfalls that we see most often.
- Failing to plan. The reason most people do not plan is simply procrastination. Whether we think we are too busy or the cost is too expensive, the price of not planning is clear when the unexpected happens and our loved ones find themselves in either guardianship or probate court to manage or distribute our assets without our prior input. Simply put, none of us have a crystal ball so planning for the unexpected is the best thing we can do for our family and loved ones now.
- Not discussing with family and friends. It is critical that you share with your executor, agent, and trustee that you have signed an estate plan and where they can find the original documents. During a medical emergency or at the time of your death, you want your fiduciary to know that your plan exists and how to access the legal documents swiftly. We always encourage you to share your Health Care Power of Attorney document, HIPAA release form, and Living Will with your agents so they have a copy available to them when it’s needed. Whether you share more details about your estate plan is ultimately up to you, but we recommend sharing the fact that you have a plan and where to find it at a minimum.
- Forgetting about Power of Attorney. When we are thinking about a Power of Attorney, we are generally thinking about a Property or Financial Power of Attorney and a Health Care Power of Attorney. Both are extremely important as they allow your agent to step into your shoes during your lifetime during times of incapacity. If something unexpected happens and your family needs to speak to your bank to handle your monthly bills, they will need either a valid Property Power of Attorney or a court order appointing you as a guardian. The guardianship process is long, costly, and public. The Power of Attorney avoids the need for a guardianship petition.
- Not naming backups. Throughout your estate plan, it is important to plan for the contingencies. This means that if you name Person A to be your trustee, you should think about who you would want to act if Person A is unwilling or unable to act on your behalf. It is important to have a backup so someone is available to act on your behalf if Person A is incapacitated or has passed away. We always recommend having at least one backup, but it may make sense to list more in certain situations.
- Not keeping the plan updated. Keeping your estate plan updated is critical to make sure your loved ones can step in and seamlessly assist in the event of your incapacity or death. Just like any investment, you want to review the terms periodically and make changes as needed when your life circumstances change or if there have been changes in the law. We recommend that you review your plan at least every three to five years or sooner if there have been significant changes to your life, finances, or health.
The attorneys and staff at Sinclair Prosser Gasior stand ready to assist you in avoiding these estate planning mistakes. If you haven’t created an estate plan, or if it’s been three or more years since you put a plan in place, contact our office at (410) 573-4818 or www.spgasior.com
