Although estate planning can be complicated, a well-thought-out plan can provide peace of mind for your loved ones and help them to continue their lives after you have passed. There are some mistakes families make when planning their future. Continue reading to learn more about the most common mistakes in estate planning and how you can avoid them.
Not Having an Estate Plan
Neglecting to create a plan is the most common problem. Failure to draft a plan can not only put at risk your assets but also your loved ones. A common misconception is that estate plans are only meant to protect money when in reality they can do much more.
Procrastinating about your estate plan is not a good idea. If you wait too long to create your estate plan, documents can get lost or assets lose value. It can also cause delays in your ability to finish the estate planning. It is important to think about your future as soon and as often as possible.
Planning Around Assets
It’s vital to have a plan, even if it’s timely. However, it can be dangerous to begin in the wrong place, especially if your plan is based on specific assets. You may overlook the fact that these assets are temporary by being too specific. Season tickets, for example, may not be retained for the rest of your life. It is important to include language that refers to all assets, especially those that last.
No Asset Liquidity
Similar to how important it is to keep durable assets in your mind, it is vital that all assets are liquid. Assets that have liquidity are easier to divide and more easily accessible. This allows your loved ones to divide assets as per your wishes. Business owners also need to have liquidity in their assets.
Neglecting Digital Assets
Assets can come in many forms and sizes in the digital age. It’s easy to lose sight of assets over time. To prevent such an issue from happening, it is important to draft an estate plan quickly. You must maintain accurate records of all digital investments, including passwords and digital wallets.
This article was written by Alla Tenina. Alla is one of the best tax attorneys in Los Angeles California, and the founder of Tenina Law. She has experience in bankruptcies, real estate planning, and complex tax matters. Click here for more information.
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