On the surface, Estate Planning in Kentucky seems simple. You tell the attorney what you have, and who you want to leave it to when you die.
Unfortunately, it’s not that simple, and making a mistake while creating your estate plan can cause a great deal of stress and chaos for your family when you’re gone.
Here are five of the most common mistakes made when creating an Estate Plan.
- Thinking Your Estate Is Too Small For a Planning
You may have not amassed millions of dollars and dozens of properties over the years, but chances are you do have some type of estate to your name. And, believe it or not, even the smallest of estates can cause family discourse after your death.
A knowledgeable attorney will tell you there is no estate too small to make a plan.
- Do It Yourself Estate Planning
There are hundreds of online sites that will allow you to download documents to create your Estate Plan. But a good plan is more than just documents.
You need someone that can guide you through the legal structures that go into Estate Planning. Like a snowflake, no two Estate Plans are the same. Trying to create a plan online is like trying to cure a cold on a medical website. The average person doesn’t know the requirements necessary to have a valid Estate Plan, thus how can they be sure the documents online are correct?
- Not Knowing the Difference between Estate Taxes and Probate
You can avoid Probate, but might still have to pay taxes based on the size of your estate. And, if your estate is small enough to avoid taxes, you may not be able to avoid probate. Confused?
This is just another reason you need to have a knowledgeable attorney guiding you through the process.
- Leaving Assets Directly to a Beneficiary
Can leaving a lump sum of cash to someone ever be bad? The correct answer would be yes.
Many assets, such as bank accounts and life insurance policies, require or have the option to name a beneficiary in case of your death. But can that beneficiary handle a sudden influx of wealth? If the beneficiary is an addict, or maybe too immature, then a large sum of cash can be very bad. This is where setting up a Trust, where someone can manage the assets for them, can be a good idea.
- Not Having an Estate Plan
This, obviously, is the worst mistake of all. Whether you’re too lazy to create a plan, or think you’re just too young for one, you’re setting yourself, and your family, up for disaster.
At a time when 64% of Americans don’t have a Will (USA Today July 11, 2015), you’ll want to get ahead of the game, because if you don’t have an Estate Plan, you can be guaranteed that the state will have one for you, and it won’t be the one you, or your family, wants.
Avoid the risk of leaving your family behind without a plan, and consult with an Estate Planning attorney that can answer your questions.