Founding Attorney
Many people recognize the importance of safeguarding their assets and protecting their family’s future. However, when people attempt to create estate plans without thoroughly considering all angles, the consequences can be dire. In the context of estate planning, even minor mistakes may lead to the failure of your overall objectives. Working with an experienced Texas estate planning attorney can help you avoid the following pitfalls.
Failure to Update the Estate Plan Regularly
One of the most prevalent reasons estate plans fail is that people often create them and then neglect to update them as life circumstances change. Marriages, divorces, births, deaths, and significant changes in assets can all impact your estate plan’s effectiveness. Even in the absence of these types of events, you should still aim to review your estate plan at least every few years.
Failing to update your plan to reflect changes in your circumstances or desires can result in unintended consequences, such as assets being distributed to the incorrect beneficiaries or in a manner that does not align with your current wishes.
Not Planning for Incapacity
Estate planning is not just about what happens after you pass away. It also involves preparing for the possibility of becoming incapacitated. If you become unable to make decisions for yourself due to illness, injury, or cognitive decline, having documents in place such as a durable power of attorney, healthcare power of attorney, and advance directive to physicians (living will) can ensure your affairs are managed according to your preferences. Without these documents, your family may need to go through a lengthy and expensive court process to appoint a guardian or conservator to make critical decisions on your behalf.
Choosing an Inappropriate Executor
The executor of your estate is responsible for managing the probate process, paying debts, and distributing assets to your beneficiaries. Choosing an unsuitable person for this role can lead to delays, conflicts, and even legal challenges. When selecting an executor, consider factors such as their trustworthiness, financial responsibility, and ability to handle complex legal and administrative tasks. It is also crucial to discuss your choice with the potential executor to ensure they are willing and able to take on the role.
Poor Understanding of Tax Considerations
Estate planning involves dealing with a complex mix of federal and state tax laws. Failing to properly consider the tax implications of your estate plan can result in your beneficiaries sacrificing a significant portion of their inheritance to taxes. For example, not taking advantage of the annual gift tax exclusion or failing to properly structure trusts can lead to unnecessary estate and gift tax liabilities. Working with an experienced estate planning attorney and tax professional can help you develop strategies to minimize tax exposure and maximize the assets passed on to your beneficiaries.
Neglecting to Work with an Experienced Estate Planning Attorney
Estate planning is a complex task. A successful approach requires a thorough understanding of several areas of Texas and federal law, as well as a firm comprehension of financial planning. As such, attempting to create an estate plan on your own can result in falling victim to the above issues and many more. Working with an experienced Texas estate planning attorney can help you create a comprehensive estate plan that meets all your needs.
The knowledgeable Fort Worth estate planning team at the Law Office of Carey Thompson, PC, has the experience and skills you need to make your estate plan a success. Call us today or contact us online for a free consultation to learn more about our services.