You'll have a lot on your mind as you age. Although you may have created an estate plan many years ago, it doesn't necessarily mean it can remain the same into the future.
As you get older you should get into the habit of reviewing your estate plan at least once a year. With this strategy you never have to worry about making a mistake that could cost your family time or money down the road.
Here are a handful of estate planning mistakes that you need to avoid as you age:
- Neglecting to review your estate plan. As noted above, you need to review your plan every year, as you never know when you'll need to make a change.
- Forgetting to alter your estate plan after a major life event. For example, if your spouse passes on it's likely that you'll need to alter your estate plan, such as by naming a new beneficiary.
- Not planning for a disability. You hope that you never face a disability as you age, but you need to prepare for anything that could go wrong. There is more to estate planning than thinking about what happens when you pass on. Your estate plan should also outline who will handle your finances and health care decisions if you are incapacitated for any reason.
- Overlooking the many ways to reduce your estate tax. This is important as you age, as there are things you can do to reduce your estate tax so that more money is left behind to your loved ones.
There is nothing wrong with creating an estate plan with the idea that it will remain the same until the day you pass on. However, you shouldn't assume that this is the right approach. You may need to make changes along the way.
By avoiding these common estate planning mistakes you'll feel better about your plan as you get older. Once a year you should review your plan, learn more about changes to state and federal laws, and focus on your legal rights. When you take this approach you can do your part in avoiding a costly mistake.