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    Estate planning: Don’t make these mistakes

    Failing to correctly draft an estate plan can lead to long delays in probate court or improper execution

    Joel M. Blau, CFPJoel M. Blau, CFP Ronald J. Paprocki, JD, CFP, CHBCRonald J. Paprocki, JD, CFP, CHBC


    A colleague told me he created his own estate plan on a website versus using an attorney. Is that a good idea?

    Sometimes people attempt to make an estate plan without consulting legal and financial professionals. Mostly, this is because they may have a general understanding of estate planning and believe they can do it themselves without paying for professional services. Everyone is different, and a boilerplate form oftentimes is not sufficient. Here is a list of potential estate-planning mistakes you can help avoid with professional counseling.

    Having an outdated estate plan. Your life and financial circumstances may change, and your estate plan should change accordingly. For instance:

    • Your parents may have died so they can no longer be beneficiaries.
    • Your children may have gotten married and had children of their own.
    • You may have divorced and remarried.
    • Your assets have grown (or decreased) significantly.
    • You no longer own a house or you purchased property.

    Your estate plan should take these and other life changes into account. It's a good idea to review your plan at least once a year.

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    Failing to revise your will. The will you had drafted many years ago may no longer apply for the reasons listed above and others. Some people believe that if they scratch out a part of an old will, add information, and initial the document, it will be valid. This is never the case.

    Relying only on joint tenancy to avoid probate. Many assets are transferred outside of wills. For example, assets titled in joint tenancy pass to the surviving joint tenant, not per the terms of your will. Many feel that you and your spouse should own a home as joint tenants to avoid probate. This move really only avoids probate on the first death. When the surviving spouse dies, the home will typically end up in probate.

    Not coordinating a will and a trust. Creating a trust and transferring assets to it may help you avoid probate and save taxes. However, if you have a will and a trust, be sure the documents are aligned so your wishes will ultimately be carried out. If a will and a trust are not in agreement, delays and unnecessary costs may be incurred.

    Titling assets incorrectly. You want your intentions to be carried out for all assets, including your primary residence, vacation home, bank accounts, brokerage accounts, retirement accounts, and even vehicles. Be sure to make beneficiary designations and properly title accounts. Designate a beneficiary (or beneficiaries) on individual retirement accounts, company retirement plans, and other accounts. Take time annually to review them as they will control the distribution of those assets.

    Next: Not naming successor or contingent beneficiaries

    Joel M. Blau, CFP
    Mr. Blau is chief executive officer of MEDIQUS Asset Advisors, Inc., in Chicago. He can be reached at 800-883-8555 or [email protected]
    Ronald J. Paprocki, JD, CFP, CHBC
    Mr. Paprocki is chief executive officer of MEDIQUS Asset Advisors, Inc. in Chicago.


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