Last week, we outlined a few estate planning mistakes you and other Detroit residents might make that could end up being quite costly in the long run. We will conclude that topic in this post, including some suggestions on how to avoid these mistakes, preserve your pocketbook and save your loved ones some grief.
According to U.S. News, these estate planning mistakes could end up costing you or your heirs more in taxes and reduce their inheritance, as well as create a hardship for minor children or disabled dependent adults.
Not having your financial affairs in order. Over the years, you might have accrued a sizeable estate, which could include multiple bank accounts, stocks and bonds, retirement funds, real estate property and business assets. All of the information regarding these assets should be organized, so it is not a nightmare for your heirs to deal with after you pass away.
Designating the wrong guardian for dependents. It might seem like a good idea to name your parents as guardians of your children if something happens to you. However, consider the age and abilities of your parents before making this decision. As time passes, you might need to reconsider your choices, so a burden is not placed upon elderly caregivers and so your children or other dependents are best taken care of.
Not considering tax implications. It can help to consult with a tax advisor while making your estate plans. Some options have less of a tax burden than others. For example, many trusts are much more cost-effective in regards to taxes than a simple will or giving a monetary gift to a loved one.
These estate planning topics are complex, so you should remember that this information is only general in nature, and should not replace the advice of a lawyer.