The 10 Most Common Estate Planning Mistakes, Part 3

In the article Top Ten Mistakes Made in Estate Planning, Ronald P. Kendall discusses 10 common mistakes that both individuals and attorneys make when they go through the estate planning process.

In this article, we will discuss the next 2 mistakes of the top ten mistakes made in estate planning.  The final 2 will be discussed in a separate blog article to follow next week.

 7.      Failure to do disability planning

One of the most common mistakes people make is that they don’t plan for what will happen to them or their family after they have become disabled.  There are many decisions that must be made by someone when you are in a period of disability.  These decisions include, but are definitely not limited to,

i.   Where to live,
ii.  What kind of medical treatment you will receive,
iii. Who is going to take care of you, and
iv. What activities are you going to want to do.

Almost all of us have thoughts on most, if not all, of the above decisions.  However, someone else will make those decisions for you if you aren’t clear in your estate plan about how you want to be treated during a period of disability.  The worst case scenario is where someone does zero disability planning.  A court will appoint a guardian/conservator that will make all your choices for you if you have not planned for disability.

If you do some basic planning and name a healthcare agent, this will at least take the decision making out of the court system. Most people just name someone as their healthcare agent and state when and if they want life support removed.  However, the decision to remove life support is only one of many different decisions your healthcare agent is going to make during what is all too often a very long disability period where this decision to remove life support comes at the very end.

Therefore, it is best to be proactive and name your healthcare agent in advance and provide detailed instruction in your estate plan regarding how you want to be treated.  This not only makes clear your desires on how you wanted to be treated, but also alleviates some of the stress the healthcare agent will face when attempting to take care of you in a fashion that you would want.

8.      Failure to plan for wealth reception

Few people, if any, plan for their beneficiary’s reception of the estate.  We believe that there are 3 stages to planning for wealth reception and they are

i.  Creating the money,
ii.  Transferring the money, and
iii. Receipt of the money.

Most people focus on the first 2 steps.  They only think about how they can create more money and in what manner they plan to transfer that wealth to their later beneficiaries after they pass away.  Few people stop to think about what will happen when the beneficiary has that money.  They don’t try to look at it from the point of view of the receiver.  However, what if we look at a plan from the point of view of the person that receives the money, might we get a completely different set of questions and concerns?

As mentioned above, the final top 2 mistakes made in the estate planning process will be discussed in a separate blog article that will be posted next week.

For additional information on estate planning and what to avoid, attend one of our upcoming workshops or call us to make an appointment.

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Disclaimer:  The information provided in this article is for informational purposes only and not for the purpose of providing legal advice. You should contact your attorney to obtain advice with respect to any particular issue or problem. Use of and access to this article does not create an attorney-client relationship between Solari Law and the user or browser.