Estate Planning

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Estate Planning Service

Ancillary legal documents not updated: Concerning health care

directives, living wills, powers of attorney, etc., chances are

the laws in your state may have changed recently and your

documents may not be valid or could be challenged. We

recommend that our clients update these at least annually.

22. Estate plan not optimized: In a situation where adequate

estate planning has not been done, the lion’s share of the

estate could end up going to the Internal Revenue Service

rather than to children, family, and/or charities.

Families affected by divorce: Remarriage brings new challenges

in planning. For example, a remarried man might

want to provide for the income needs of his current spouse

in the event of his death, but he might want the bulk of his

assets to pass on to the children from his !rst marriage. Or a

woman who receives an inheritance from her parents might

want to pass it on to her children, not her current spouse.

Without careful planning here, you could accidentally end

up disinheriting your children or leaving your assets to

someone you never intended to.

“Yours, Mine, and Ours” family: Imagine the complexity in a

situation where each spouse had children prior to the marriage

and the couple then has a child or children together.

Estate planning could be challenging for this family.

18. No wills or trusts: An entire book could be written on the

problems we have seen in estate planning. By not having a

will, you die intestate, and the courts must decide who gets

your money. In some states, it is not automatically assumed

that the surviving parent is granted guardianship of the

minor children. You should, at a minimum, have a will to

communicate your wishes as to the guardianship for any

minor children.

Improper estate plans that are outdated: This can cause some

unintended consequences, such as the following:

a. Assets being left “outright” or in some graduated format

to the children after the second death: either of these

formats leaves open the possibility of inheritances being

attacked at some later date due to divorce, liability suits,

bankruptcies, or creditor issues of the bene!ciaries.

b. Under ideal circumstances, amounts left to a spouse may

be left with creditor protection, but that has to be built

into the plan.

c. Assets left to a spouse are sometimes unwittingly left to

a future spouse, in which case the deceased person unintentionally

disinherits his or her own children. Sadly, I

have seen this happen before.