Despite the legal pitfalls associated with improper estate planning, only 32% of Americans have undergone this process. This is alarming, especially for older adults and their families.
Here, we’ll discuss how to avoid some common mistakes in estate planning documents, including things like:
- Failure to communicate
- Forgetting critical information
- Improper document drafting
Read on to minimize document preparation papers and make inheritance planning as seamless as possible.
Know What Estate Planning Documents You Need
Everyone can benefit from having a will no matter what their financial situation looks like. Even those with small estates have the right to allocate funds and property as they like. Fitness-minded adults should also have plans since emergencies aren’t always foreseeable.
As people grow older, the need for estate planning documents increases. It protects their assets and ensures that they go to the appropriate location once they pass away. It can provide seniors with peace of mind.
Some of the most common facets of estate management include:
- Proof of identity documents
- A last will and testament
- A living will
- Beneficiary information
- Advance healthcare directives
- Living trusts
- Power of attorney
- Funeral instructions
There may also be other documents for some people with larger or more complex estates. A legal professional can advise you on your unique situation.
Talk With Family Members
Unless you are the only living family member of the person whose estate you’re planning, talking to others is likely a good idea. This is especially true if the senior is planning to designate multiple beneficiaries.
Talking about the estate:
- Sets expectations for fund and property allocation
- Decreases the likelihood of contention in the future
- Helps to keep families strong and cohesive
- Enables people to put their heads together when planning
After your elderly loved one decides to plan their estate, create a designated time for a family meeting. This can take occur within the walls of an independent living community that they live in. It could also happen at home.
This meeting should include the executor, trustees, and their spouses. Anyone else mentioned in the will or trusts should be included, too.
Plan and Strategize
Helping your loved one create an estate plan requires careful planning and preparation. This seven-step process involves:
- Finding an estate planning lawyer
- Counting relevant assets
- Identifying key people (executors, power of attorney, etc)
- Determining which documents you need
- Managing those documents in an organized way
- Discussing long-term care options and possible guardianship
- Plan to update the estate plan every five years
This doesn’t just ensure that you won’t forget anything important. It also helps you feel more organized. You won’t become as overwhelmed with a million simultaneous tasks when you follow the steps in order.
Make sure that you consistently communicate with the senior whose estate plan you’re making. They’re in charge of their own assets. Your task is to help them fulfill their wishes.
Don’t Forget Important Sections
It’s easy to forget about some sections of an estate plan when there’s a lot to consider. Even taking things step by step doesn’t ensure easy organization.
Some families forget about making financial arrangements for:
- End-of-life care
- Hospice care
- Funeral arrangements
- Burial costs
Planning these things out in advance helps you and your family stay together while grieving. It minimizes stress during an already difficult time.
Make sure to talk with your senior loved one about their wishes regarding these facets of estate planning. Make sure that they’re lain to rest as they want to be.
Many families also only think of physical assets when creating wills and trusts. Unfortunately, in 2024, this can be detrimental since over 20% of Americans own crypto-related digital assets.
Worse, many people own more common digital assets, too. These assets include:
- Email accounts
- Social media accounts
- Online banking profiles
Add a digital estate plan to the will. Have the senior name a Digital Executor that ensures these things are appropriately handled.
Prioritize Healthcare
Many people make the mistake of allocating assets in the estate plan but failing to allocate healthcare power.
If you’re working with your loved one to create a comprehensive estate plan, you need to appoint a medical Power of Attorney. A Healthcare Proxy is also critical.
These people will make medical decisions for the estate owner if they’re too incapacitated to make their own choices. Usually, these proxies are surviving spouses or children.
Plan for Taxes
It’s easy to forget about estate tax liability when creating a plan. However, it can take a huge chunk of money from the estate in some cases.
This may leave some beneficiaries with less money and fewer assets than they had previously believed they would receive.
The good news is that the federal government only taxes estates with $11.58 million or more per person as of 2024. Texas also has no estate or inheritance tax. You’ll only have to adhere to these federal guidelines unless the laws change.
Get Professional Help to Avoid Mistakes
Knowing how to avoid document preparation errors and inheritance planning pitfalls might sound easy, but there are a lot of procedures to remember. Without the help of a legal expert, it can get overwhelming.
An estate planning attorney:
- Helps your loved one write a legally binding will
- Sets up trusts that benefit both seniors and their beneficiaries
- Designates beneficiaries
- Draft documents designating power of attorney
- Advises clients about probate and finds ways to avoid this process
- Answers questions about anything you or your loved ones are confused about
- Keeps you informed about the estate planning process
- Offers estate planning tips to ensure everything goes smoothly
They also will look over and finalize all estate documents to ensure that they will hold up in a court of law. This ensures that your loved one’s wishes are fulfilled and prevents family disputes after they pass.
Keep Seniors Comfortable Throughout the Estate Management Process
Understanding the ins and outs of estate planning documents is essential for those with aging loved ones. However, keeping parents and grandparents happy and comfortable as they age is just as important, if not more so.
Conservatory at Champion Forest offers a plethora of services for older adults in independent living. From nutrition and wellness programs to invigorating social activities, our residents have a lot to enjoy.
Reach out and schedule a tour of our community to learn more about what we have to offer!
