Although most Americans admit to knowing the importance of inheritance planning, over half do not have a plan in place. I reason for this appears to be that there are a number of myths and misconceptions about inheritance planning. To some extent this is understandable because the average person has little reason to know much about inheritance planning until they actually sit down to create their plan. Unfortunately, however, some of those myths can result in costly mistakes that can negatively impact you, your estate, and/or your loved ones. To help you avoid making any of those mistakes, the Florida estate planning attorneys at Kulas & Crawford discuss five common inheritance planning myths.
Myth #1 – I don’t need to worry about inheritance planning until I have a valuable estate.
This is something we hear all the time from people who have yet to create an inheritance plan, also referred to as an “estate plan.” People believe that they must reach an imaginary asset threshold before they need to start inheritance planning. The truth is that the value of your assets is not important. What is important is that they are your assets and you should decide what happens to them when you are gone. Without at least a basic estate plan in place, the State of Florida will decide what happens to the assets you do have. That promise you made to a favorite niece that she will get the family heirlooms you have will not be honored. The charity you donate to on a regular basis will also receive nothing if you die intestate (without a Will). What’s important is not the size or worth of your assets, but your right to decide what happens to them.
Myth #2 – I’m too young to worry about inheritance planning.
This is often expressed along with Myth #1. Your age, however, is not important when it comes to inheritance planning. Every adult, without regard to age, needs an estate plan. Life changes rapidly when we are young. Before you know it, you are married and expecting your first child. Don’t make the mistake of waiting until you have people to protect to create your inheritance plan. The plan should already be in place. Your Last Will and Testament, for example, is your only opportunity to let a judge know who you would want to be your child’s Guardian if one is ever needed. We don’t get a warning when tragedy is going to strike which is why it is so important to always have an inheritance plan in place.
Myth #3 – I have a Will so I’m done with inheritance planning.
Your Last Will and Testament may be the foundation for your estate plan; however, a comprehensive estate plan typically includes additional strategies and documents to help achieve all your inheritance planning goals. Moreover, your plan needs to be reviewed and revised on a regular basis as well as when life events require a revision.
Myth #4 – It’s best to appoint someone you trust, like a spouse, to fiduciary roles.
A common myth – and a big mistake. Fiduciary roles in your inheritance plan, such as Executor or Trustee, play critical roles in your plan and comes with a wide variety of duties and responsibilities. Appointing the right person will result in the success of your overall plan whereas the wrong person could cause your plan to fail. Consider what experience and knowledge the role requires before making your appointment.
Myth #5 – You can save time and money using DIY forms you find on the internet.
On the contrary, using fill-in-the-blank “DIY” forms you find on the internet will frequently result in a much more time consuming and costly probate of your estate after you are gone. The reason for this is that DIY forms are often riddled with out of sate information and errors. They are also known for creating ambiguities and failing to dispose of your entire estate. Any of these problems will result in litigation during the probate of your estate. Ultimately, this costs your loved ones much more time and money than you saved by not working with an experienced estate planning attorney.
For more information, please join us for an upcoming FREE seminar. If you have additional questions or concerns regarding inheritance planning, or if you wish to get started on your plan, contact the experienced Florida estate planning attorneys at Kulas & Crawford by calling (772) 398-0720 to schedule an appointment.