All adults need to take the time to set up an estate plan that outlines their wishes for after they die. There are several components to consider. Learning about how they all work together is beneficial.
As you’re creating your estate plan, you must ensure you aren’t making some common errors. These mistakes can greatly impact your estate plan.
Including large assets in the will
Your will has to go through the probate court. It’s possible that it will be challenged, and it becomes public record. Instead of passing down large assets in the will, think about establishing trusts for them. Trusts can bypass probate and are a more private option for your loved ones.
Failing to pay down the estate
People who have considerable assets may need to pay down the estate some so it isn’t subjected to estate taxes. There are annual limits to how much you can gift to each individual or organization before a tax applies. If you’re married, you and your spouse each have a limit that you can use to make larger gifts.
Putting it away and forgetting it
Once you have the estate plan written, you can’t just forget it. You need to review it periodically so you can ensure it still meets your wishes. This is especially important after a major life event, such as a marriage, divorce or baby’s birth.
Crafting your estate plan now can help you to have peace of mind since you know your loved ones will be cared for to the best of your ability. Taking the time to explore your options is beneficial since there might be multiple options you can use.