The end of the year is a popular time for people to either update their estate planning, or to finally get a Will done! Over the next few weeks, we will be posting tips on how to avoid common estate planning errors. The first two are below.
Not Updating Beneficiaries
Failing to name a contingent beneficiary on retirement accounts and insurance policies is a very common mistake. If you fail to name a beneficiary, the result can mean that the proceeds likely will default to your estate. This means that an asset that would have passed without probate, would now be subject to probate. Also, neglecting to remove a former spouse on these accounts can have significant negative consequences.
Failing to Address Guardianship of Minor Children Who Are Beneficiaries
Who will handle the money and assets for the minor children? And for how long – until they are 18, 25, 30 years old? Do you need a Trust to help in these determinations? What are your wishes about who should raise your minor children if you pass when they are still small? You should make those wishes known in your estate planning to avoid costly litigation later.