Estate Planning Mistakes | Attorney in Raleigh NC
Estate planning can bring feelings of dread that may make you want to put it off, but not having your affairs in order can cause major problems later. Imagine leaving your family with no idea of what to do if you become incapacitated or pass away. It’s better to have your estate plan in order before those critical situations arise.
People make many mistakes when it comes to estate planning on their own. In this two-part series, our attorney in Raleigh NC will take a look at some of the most common.
- The first mistake is not having a plan. Depending on your state laws, there are rules that would apply to your estate should you pass away, but the way your estate is distributed may not be the way you would have wanted. You have a choice in the matter if you plan ahead. Knowing that your estate will be distributed the way you want, not the way the state sees fit, should bring you some sense of security.
- Another mistake people make is trying to do it themselves rather than seeking the advice of a professional. There are countless websites that will allow you to create your own will. It can be a risky move for someone unfamiliar with their state’s laws and guidelines. Having input from an estate planning attorney can ensure that your documents are comprehensive, detailed, valid, and represent you and your beneficiaries’ best interests.
- People commonly name someone as executor of the estate who may not be able to handle the duties. He or she will need to collect all assets, pay obligations, and then see that the remaining assets are distributed. It sounds simple, but each task requires other steps in order to be properly executed. Make sure that the person you designate to handle your financial affairs when you are gone is someone that you trust and that is responsible.
- Another mistake people make is not properly distributing the assets and not considering the financial implications for the person on the receiving end. If someone has several children with different financial needs, it may be better to divide the estate according to their income. It is also important to consider the age of the person that will receive assets. If he or she is not mature enough to handle it, it may need to be put in a trust that can be accessed at a certain age.
- People often overlook the estate tax exemption, which allows a person to give up to $14,000 tax-free to someone as a gift. This helps lower the amount of the estate, which means fewer taxes will be paid on it. Rather than giving money after your death that will be taxed at the estate tax rate, which can be as a high as 40 percent, the money can be given now and not be taxed.
These are just a few of the mistakes people make in their estate plans. Check out the next part of this series for more mistakes to avoid so that you can be educated on how to best handle your estate planning decisions.
Eldreth and Eldreth | Attorney in Raleigh NC
As always, feel free to contact us with any questions or concerns you may have about estate planning. Also contact our estate lawyer to schedule a consultation if you have yet to start estate planning. It's never too early to make plans for your wishes upon death. In addition, our lawyer is here to help you with all your legal matters, whether it be estate planning, small business, trademarking, copyrighting, or DWI issues.