Avoid these 8 mistakes during estate planning
Updated On: Jan 01 2014 12:26:58 AM CST
By attorney Keith Morris, Special to THELAW.TV
Drafting an estate plan is an important step for every adult, but there are several common mistakes that are made in this process. When you set out to create your plan, don't leave these key points out:
1. Advanced medical directives: With the many wonderful advancements in medicine and health care, a greater number of Americans are living with illnesses and injuries that once would have been fatal. In some cases though, these conditions can leave you temporarily or permanently unable to make decisions on your own behalf. Having an advance medical directive as part of your estate plan will allow you to designate a trusted person to make health care decisions on your behalf. Even more importantly, you can lay out in this document what types of medical care you are comfortable with so that the person you choose knows your wishes and can follow them.
2. Power of attorney: If you were incapacitated by injury or illness, who would make financial decisions on your behalf? Bills will keep coming, no matter what your situation, and someone must be able to take care of these matters for you. Designating an agent to act for you in financial matters is vital to any estate plan. An estate planning attorney can help you include a power of attorney document in your plan to do just that.
3. Distribution of personal belongings: In the probate process after a loved one dies, the most hotly contested items aren't usually homes, cars or savings accounts but the personal belongings of the decedent. When you and your estate planning attorney draft your will, be sure to explicitly designate your prized personal belongings to the beneficiaries of your choice.
4. Let someone know where your plan is: Even the most carefully crafted estate plan is meaningless if no one can find it when needed. Avoid this issue by telling a trusted person or persons where you are storing your estate plan and make sure it will be accessible when needed.
5. Protection for your beneficiaries: One issue that is often overlooked is what happens to a person's inheritance when they go through a divorce. If you leave money or property to an adult child, and he or she goes through a divorce, is their ex-spouse entitled to part of the inheritance? While no one hopes for this scenario, it should be considered. An estate planning attorney can walk you through ways to protect your loved ones' inheritance.
6. Care for pets: Pets are beloved members of the family, yet they are often overlooked when planning for the future. If something happens to you, who would take your pet? During estate planning, you can designate a guardian for your furry family members.
7. Medical retirement: If you suffer an injury or illness that forces medical retirement, will you have the assets to continue your lifestyle? Can you afford assisted living facilities if needed? These are questions that should be discussed when working on your estate plan. In some cases, you may consider self-insurance or private long-term care insurance. Your attorney can also help you structure your assets so that you may qualify for Medicaid if needed to pay for long-term care.
8. Keep it updated: Once you have a good, all-encompassing plan in place, it may never need any changes. But for most people, estate plans will undergo many changes over the course of their lives as circumstances and relationships change. Update your plan every few years or when major life events, such as marriage, divorce or the birth of children or grandchildren, occur.
The author, Keith Morris, is an estate planning and probate attorney in Houston, Texas. His firm, Jones Morris Klevenhagen, LLP, has litigated for clients all over the state of Texas.
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