Common Mistakes People Make During Estate Planning
Estate planning can provide peace of mind, ensuring that your assets, interests, and loved ones will be protected after you die, but it is also fertile ground for some costly mistakes. Whether due to oversight or improper planning, any mistakes made during estate planning can undermine your intent and drastically diminish the financial legacy you leave behind. They can also create added stress for your heirs in a moment of grief. To help you avoid some basic errors that could prove to be costly, Keith R. Romero Attorney and Counselor at Law, has put together a list of the most common mistakes people make during estate planning.
1. Not hiring an attorney
Many internet services offer DIY options for your estate planning, but using them without sufficient knowledge of the law can be a big mistake. I don’t know how many times I have had to correct or amend something that people have done on their own. Their intention is to save money, but it ends up costing them more in the end, either during re-drafting or when they pass. Don’t be afraid to invest in a comprehensive and well-tailored attorney that specializes in estate planning. This may cost a little more than you want, but something like probate can be much more expensive than a well-drafted and executed estate plan.
2. Hiring an attorney without sufficient experience
Unfortunately, many attorneys believe that an adequate estate plan is a simple thing to draft. They can be much more complex than people realize and are not a one size fits all sort of concept. Not all attorneys specialize in estate planning. So, you’ll want to find one whose primary focus is estate and trust law in your state. You will also need to determine if the attorney typically deals with estates that are similar to your unique situation.
3. Starting a business without proper planning
When starting a business, don’t launch your idea or venture until you have consulted an attorney. So many times, I have had entrepreneurs come to me after they have launched their venture. This puts me in the unenviable position of “playing catch up” or being unable to correct something that is already in play. This is why I strongly suggest that you see a lawyer first. It will be beneficial to you as well as them.
4. Not accounting for emergencies
It is better to infuse money into your business from the outset. Try to be in a position where you have adequate capital on the front end. This way, you will know exactly how much money is available to run your business, and you will not have to spend time trying to secure other forms of funding from investors or banks. Account for emergencies and have a buffer of money for the unexpected. This can help you to prioritize your business expenditure and avoid excessive spending.
5. Forgetting to fund the trust
If you have a trust drawn up (which is a type of EP instrument that provides more control and privacy), don’t forget to fund it. That means re-titling the assets that you want to be placed in the trust in the name of the trust. For example, a piece of real estate that is going to be placed in the trust needs to have a new deed recorded in the name of the trust, not the individual’s name.
To avoid more mistakes like these, reach out to Keith R. Romero Attorney and Counselor at Law. I have always believed that everyone, even us regular folk, can benefit from thoughtful and well-executed estate planning. There is a misunderstanding and a mistaken belief that estate planning is only for the “wealthy.” That is simply not true. Whatever you have, you have worked hard for, so protect it, manage it and control it - while you are able! To take the stress off your loved ones, make your estate decisions right now. As a legal expert for several decades, I have obtained a certain level of nuanced and intuitive instinct coupled with a very strong grasp of the law. I offer estate planning, business planning, and real estate law services across Albuquerque, Rio Rancho, Bernalillo, Los Lunas, East Mountain Area, and Santa Fe, New Mexico. For a complete list of my services, please click here. If you have any questions about estate planning, I would love to hear from you. Please contact me here.