Estate Planning MistakesFriday, June 29th, 2018, 11:18 pm
Contrary to a common belief, estate plans are not exclusive to the rich and famous; this is simply because most people have at least one thing of value to them such as a car, money, or a house. Many people can benefit from having an estate plan in place; what most people do not know is that proper estate planning goes beyond allocating money or other assets. Every estate plan has its own unique features; however, the same mistakes may be present in all of them. There are a number of common estate planning errors that can be avoided by arming yourself with adequate knowledge about estate planning.
Choosing the Wrong Person to Handle your Estate
Sometimes, the person whom you think is best for the job may turn out to be less than perfect. For instance, you may think your spouse or child may be best suited to handle the affairs of the estate when you are gone, however, there may be someone else who is not as personally invested to objectively handle the extensive duties and demands required of an executor, trustee, or guardian. Therefore, take time to find the right person.
Failure to Understand the Plan
Many people, even the most sophisticated and wealthy, could face dire consequences if they do not understand the plan. Relying on the planner to do everything may lead you to fail to understand the plan. The estate planner’s job is to ensure you understand the basics of how the plan works, what you need to do to implement or maintain the plan, and how it works for you and your beneficiaries. Therefore, take time to understand what you are signing up for; ask questions and go through every detail.
Putting Your Child’s Name on the Deed
When you put your child’s name on your deed, you end up giving your child a hefty sized taxable gift. Though gifts up to $14,000 are excluded from estate tax, those above $14,000 per spouse are taxable. Therefore, make sure you create an estate plan that passes on the home or value via an inheritance.
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