Many people are nervous right now and want to get “their affairs in order”. Not a bad idea. The problem, however, is that many rush to judgment and tend to do a quick fix rather than doing it the right way. The intent of this article is to simply list some common mistakes…
Many have a will but don’t want to bother updating it. Instead, they put a child as joint owner on an account. The parent often believes that the will still governs but a beneficiary trumps the will. Likewise, the parent often trusts that the named child will follow the parent’s verbal wishes. They might but I’ve seen many cases where they don’t. Or, the child might want to do the right thing but if they have marriage or credit problems they may not be allowed to split the money with others per their parent’s wishes as by law they are the sole owner of this account.
Much like bank accounts, when parents get anxious they often put a child on their land or home. Same problems as with bank accounts just many more ways to screw up the title when people draft their own deeds. Having a law firm draft a deed is not expensive. And, when you have a lawyer draft the deed, their job is to not only make sure the deed is drafted correctly but also that the estate planning goal is accomplished. If a deed contradicts other estate planning documents the lawyer should ask more questions and make sure the parent understands all options and how each interact with one another before recording a deed.
Drafting your own will is another problem. Drafting a will is not simply having the form say what your wishes are. It’s understanding all the different options (wills, trusts, transfer on death deeds, beneficiary designations) and the pros and cons of each. It really depends on the family and their priorities to know what plan is the right fit. In addition, the odds of a will contest are much higher when someone tries to sign a will at the kitchen table without any legal assistance.
Like with most things in life, taking your time and getting good advice on the front end with estate planning helps avoid spending much more money later to fix mistakes.
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