A Headline-Grabbing Estate Planning Blunder to Avoid

The New York Times has reported that Prince, the music superstar who recently passed away in his home from still unknown causes, did not have a will. The performer’s sister, Tyka Nelson, was quoted as saying she has no knowledge of “the existence of a will.”

Failing to draw up a will is one of the most common estate-planning blunders made by celebrities and mere mortals alike. As the saga of Prince’s estate plays out in the media in the months and years ahead, it should serve as a valuable example to anyone procrastinating on setting up their will.

To help you protect your loved ones in the event of your death, here are the top three estate-planning mistakes you should avoid, starting with the most important of all.

No Will

Studies consistently reveal the fact that a large percentage of Americans want to feel assured their assets will be properly distributed after they pass away. Surprisingly, nearly two-thirds of all U.S. adults have no will. Even if you have a modest estate, drawing up a will is an essential first step to protecting your loved ones and assuring that your wishes are carried out.

Without a will, the distribution of your assets is determined by the laws of your state. To avoid a frustrating, drawn-out process for your family, make drafting a will a priority. Don’t put it off until next year.

No Living Trust

Would you like the terms of your will to be public and accessible to anyone who wants to view them? For good reason, most people would answer no. Unfortunately, with no living trust in place, a will is a public document.

If you would like to keep the contents of your will private, you should set up a living trust. This legal document allows you to distribute assets as you see fit without having to go through the public process of a probate court.

A living trust provides additional benefits, including time saved by avoiding probate and estate tax benefits.

Fail to Plan for Disability

Don’t make the mistake of thinking that estate planning is only about preparing to have your wishes carried out after you pass away. An estate plan should also account for the event of major injury or disability. In many scenarios, power-of-attorney documents offer essential protection that is not provided by a will.

An estate planner can help you draft a power of attorney as well as similar documents like advance directives and living wills. With the proper plans put in place, loved ones could be allowed to make necessary financial and medical decisions for you when necessary. Without the proper estate planning, you shouldn’t assume that your spouse will have the right to act on your behalf.

Make Estate Planning a Priority in 2016

Cohen & Burnett have provided the premier estate planning and tax services to the Washington, D.C. area for more than 25 years. To avoid the most costly mistakes mentioned above, visit our homepage and connect with one of our estate planning professionals today.

sort

SUBSCRIBE /

Receive the latest trends, news and resources on estate planning and asset management directly to your inbox.