Many New Jersey residents recognize the value of creating an estate plan. An estate plan is a way to preserve a family's assets for future generations and create and maintain a family's legacy. But, when completing an estate plan, there are certain mistakes a person should keep in mind to avoid.
One common mistake a person can make is choosing the wrong trustee. Most of the time a person will choose one of their children, but this can put quite a bit of stress on the subject. Serving as a trustee can take quite a bit of time and if a child is chosen they often don't have the experience necessary to work through the complexities of the estate. Another mistake a person can make is not writing down who gets what when it comes to many tangible assets. Many times children fight over a precious memento, so having a separate document listing exactly who gets what and sharing this information with beneficiaries before a person dies can help reduce conflict.
Not accounting for digital assets is one of the newer mistakes a person can make with their estate plan. The popularity of digital assets, including online accounts, social media and music has exploded over recent years and almost everyone has a digital presence of some kind. Having a record of what digital assets a person has can be important for the trustee to handle. Assets should be titled correctly and beneficiaries should be reviewed periodically. This can turn into a major headache if either one of these is not done properly.
Along with this, an estate plan should be updated frequently, accounting for changes within a family including death, divorce, marriage and new children. Any of these changes can have an impact on a person's estate plan. Finally, a person should recognize any discord in their family and try to work through disagreements while they are still alive. Sharing why an estate plan is set up the way it is can be a valuable step for anyone to take.
Source: forbes.com, "Avoid these 6 estate planning mistakes", Oct. 2, 2017