AVOID THE TOP 5
WILL & TRUST MISTAKES
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There are many misconceptions and mistakes relating to creating an estate plan. An attorney experienced in the creation of a plan for you and your family is essential to avoiding mistakes that could have a disastrous effect on you and your family. We understand how to protect you and your family to make sure your wishes are carried out both during your life and after you pass.
Below are some of the most common estate planning mistakes and misconceptions:
The Belief that a Will Avoids Probate.
This is one of the most common misconceptions. A Will does not avoid the need for probate, rather, a Will merely directs how your estate is to be distributed through probate.
Failing to Plan.
Even in extremely close families, a death can put enormous strain on the relationships between surviving family members. Unspoken conflict begins to boil to the surface, memories of what “mom and dad wanted" differ resulting in resentment and long-lasting hostility. If no plan is in place, the State of Minnesota, not you, determines how your estate is distributed.
Not Understanding the Difference Between Probate and Non-Probate Assets.
A common misconception is that the provisions of your Will or Trust apply to all the assets of your estate. However, your Will and Trust only apply to specific assets. In the case of a Will, it only controls the distribution of probate assets. A Trust only has power over assets held by the Trust. Not recognizing the distinction between assets and how each is to be distributed could result in unintended distributions.
Using Probate Shortcuts.
Probate shortcuts such as adding an individual to title on the asset or naming them as a beneficiary with the intention that they distribute the assets after your death is frought with significant risk. you are relinquishing all title and control of your property. Should an unfortunate event occur to the individual named to the title or as beneficiary, such as a death, divorce, money judgment or tax lien, your property or assets would be in jeopardy of being lost.
Not Planning for Incapacity.
A plan is not complete that does not include provisions for your incapacity or disability. None of us can look into the future to see what it holds. An accident or serious medical problem could leave us unable to make our own financial or medical decisions. Because of this, creating a plan in case of incapacity is absolutely essential. It is a common misconception that your spouse or adult children can automatically step in and make financial decisions for you if you are incapacitated. The truth is, that there is no automatic right for your spouse or adult children to make these decisions. In an event of incapacity or disability, without a plan in place, a court estblished conservatorship would be required to make financial decisions on your behalf.