Avoid these common estate planning mistakes
Sometimes people make estate planning errors that have negative consequences. You can avoid potholes if you are aware. We will shed some instructive light in this post.
DIY Estate Planning
Numerous websites sell do-it-yourself legal documents, including wills and trusts. They want you to believe that anyone can plan their own estate using these boilerplate notions.
“Simple solutions” sound great on the surface. Experience tells us that these solutions are at best ineffective. You may take our opinions on the matter with a grain or salt, because we create these documents for our clients. A cynic would say that a law firm would always advise against DIY legal documents.
Actually, you don’t have to take our word for it. Consumer Reports conducted a study objective a few years ago. Staff members obtained last will templates from three of the most popular legal document websites, and they created wills using common hypothetical circumstances.
They enlisted three prominent legal professors to examine the documents and provide feedback. The educators found flaws with the documents. They said they could see how unintended negative consequences could come about when these tools are used by inexperienced people.
After evaluating the feedback, Consumer Reports advised clients to stay away from DIY estate planning notions unless the situation is extremely simple and straightforward.
False Assumptions About Trusts
Far too many people make false assumptions about trusts. They assume that trusts are very complicated documents that are expensive to create and are only useful for multimillionaires.
In reality, different types of trusts can satisfy various respective aims, and they don’t have to be especially complicated. A revocable trust is a great estate planning tool for people who aren’t extremely wealthy. You would have full control over all assets in the trust and be able change the terms at any time. The assets will be distributed according to your wishes without going through probate. A living trust is one of many options available. You should explore the possibilities in light of your unique personal situation before you make any choices.
Failure to Address Long-Term Care Costs
A lot of people who think about estate planning do not consider the fact that nursing home costs can potentially consume all or most of your legacy. Medicare does not pay for long-term care, and nursing facilities are extremely expensive.
Medicaid will cover the custodial care that nursing homes provide, but you can’t qualify if you have significant assets in your own name.
You could convey assets into an income-producing Medicaid trust to develop the right financial profile, and we can show you how it’s done.
We Are Here to Help!
Action is required if you are currently going through life without a professionally prepared estate plan. You can schedule a consultation appointment at our Oklahoma City estate planning office by calling us at 405-843-6100.
Our Tulsa location can be reached at 918-615-2700, and you can fill out our contact form if you would prefer to send us a message.
After helping his own family deal with a lengthy probate and the IRS following his father’s untimely death in a farm accident, Larry Parman made a decision to help families create effective estate plans designed to reduce taxes, minimize legal interference with the transfer of assets to one’s heirs, and protect his clients’ assets from predators and creditors Read More! Larry Parman is an attorney at law who has been practicing for over 30 years. He has helped many families with their estate planning needs.
