Blog Series: Five Easily Avoided Estate Planning Mistakes

Estate planning mistakes are made all the time and usually this is because the financial advisor/accountant/attorney has overlooked important issues. We have chosen to highlight five very common mistakes in this blog series.  All of these mistakes are easy to avoid, as long as you and your trusted advisors know how to recognize them!

It is important to also consult with an attorney in your State in order to review whether or not these issues pertain to you. In any case, it is recommended to ask your estate planning attorney what the most common mistakes they encounter on a regular basis are, and bring up these issues with them for discussion.

Mistake 5 – Not funding your living trust properly.

It is estimated that only about one-third of the trusts are funded properly. In many cases, people establish a living trust properly, but fail to transfer their assets into the trust at the proper times or at all. Therefore, it is important for your trusted advisor to actually look at each of the documents such as account statements, property tax bills, etc. in order to review the actual title of the property and determine when and how you should fund the trust.  While in many cases funding the trust properly requires relatively swift actions, not all living trusts should be funded immediately.

Occasionally, it is prudent to establish a Living Trust but not immediately fund it for reasons such as liability protection (doctors, lawyers, etc.) until they are beyond the tail period on their malpractice or because a retirement institution will not accept a sophisticated beneficiary designation attachment but will accept a trust as a contingent beneficiary.

Therefore, it is really important to discuss your full situation and goals with your advisor to avoid making a mistake in funding your trust.

This is only one common mistake.  Again, please make sure that you consult a competent estate planning attorney to make sure everything in your estate is in order and fits perfectly with your individual situation!

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