Whether you’re a millionaire or the sum of your assets is decidedly non-millionaire-like, the fact is you likely need an estate plan — because almost everyone needs an estate plan! A Kiplinger article, Ten Common Estate Planning Mistakes has some excellent insights. Contact our Wausau WI retirement team today to learn more.
Don’t build it on your own
A big mistake some people make is attempting to build an estate plan on their own. While estate planning is essential, it’s also complicated. So let me reiterate the importance of working with both a financial services professional and an estate attorney.
The article notes that currently, estate attorneys charge between $100 and $500 an hour for an estate plan, depending on the size of your assets and how complex your situation is. If you don’t currently have an estate attorney, your financial services professional will likely be able to recommend someone they’ve work with previously.
Name your beneficiaries
The beneficiary designations you make on your financial and insurance accounts typically trump the instructions you leave in your will or living trust, which means it’s important to both name beneficiaries and then update them when life changes make it necessary.
Also, it may be wise to name contingent beneficiaries in the event that you and your primary beneficiary — usually your spouse — die at the same time or closely together.
If you fail to name a beneficiary, or your primary beneficiary dies before you and you don’t name a new one, proceeds will be paid to the estate, which means they’ll likely end up in probate. The probate process could slow the distribution of the assets in your estate, which could cost your heirs time and money.
Keep your loved ones in the know
Another common estate planning mistake that many people make is not looping their family and other important people into the process.
Sharing your estate plan with your heirs and other important people in your life, may help prevent confusion, conflict, and the kind of bruised feelings that can last for years. Though the conversation is a heavy one, given that you’re discussing your eventual death, it’s important to explain your decisions and the reasoning behind them.
Make your final arrangements
Another common estate planning mistake is overlooking your final arrangements. Planning your funeral or other service isn’t anyone’s idea of a good time, but it’s important to do so.
By clearly spelling out your wishes for your final arrangements, and then prepaying or setting money aside for those arrangements, you’ll prevent yet another burden from falling on the shoulders of those you love while they’re still deeply in the grieving process.
Little things like choosing burial or cremation, selecting a burial plot, picking out songs for your service, choosing a coffin or steps for your ashes — these are all simple things you can do while you’re still alive that will be a considerable help to those who love you shortly after your passing.
And don’t forget just how expensive funeral services can be. The Kiplinger article notes that in 2024, the average funeral cost about $8,000, though it varies depending on where you live. And, again according to the article, the average cremation currently costs a little more than $6,000.