For those who don’t know, around 50% of residents in the United States over the age of 50 do not have a will. There are a lot of individuals out there who put off estate planning until it is too late.
So, what will happen if you don’t have a will when you die? Do you have any other estate planning tactics in place?
It’s a major issue to not have an estate plan. However, there are other estate planning mistakes that you can avoid easily. Today, we’re going to share with you some of the most common estate planning mistakes, from not hiring reliable estate planning attorneys Milwaukee to not having a plan.
Not Transferring Life Insurance Policies
For those who don’t know, the IRS can tax your life insurance policy upon death. If you don’t want this to happen, you should create a life insurance trust. It’s a permanent trust that is both the beneficiary and the owner. With this, the proceeds of your life insurance will not be taxed heavily and beneficiaries will not have to wait months for a payout.
Not Updating Estate Plans
You’ve got to update your estate plans after changes in business or family structure. This includes property acquisition, moving to another state, divorce, death, or birth.
If you want to ensure your wants align with your will, you’ve got to update your estate plan.
No Plan for Long-Term Care and Disability
For those who don’t know, individuals aging 60 and over have a 65% chance of requiring long-term care. This number is extremely high to ignore.
That is why you need to plan early on. You can do this by considering long-term care and disability insurance policies. You shouldn’t wait too long since rates increase every year.
Not Having a Plan at All
You’re giving the state the power to create big decisions if you do not have trust or will. The state can distribute your assets and property. If you’ve got kids under the age of 18, the judge chooses the guardian. This is particularly true if you haven’t assigned one.
Another major mistake is thinking that everything goes to your living partner if you’re married. However, that is not the case. In several states, the property owned by the deceased is divided between the kids and the living partner. If you write an estate plan, you can trust that your financial and personal affairs are properly handled.
Taking the DIY Route
One of the biggest mistakes you can make with estate planning is going the DIY route. Of course, you can save money with this. However, you are probably going to make serious errors that leave your loved ones with major issues. You might not have a legal understanding of strategies to plan your estate.
It can result in a probate court if you take the DIY route. This means that other individuals will choose how your possessions and assets will be divided. Know that estate planning includes insurance policies, retirement accounts, several bank accounts, businesses, and much more. Thus, it’s best to hire an estate planning lawyer.