Estate planning isn't just for wealthy families or people nearing retirement.
If you own a home, have children, have retirement accounts, own a business, or simply want to make sure the people you love are taken care of, having an estate plan can be an important part of protecting your family and your future.
But creating an estate plan is only the first step.
An outdated, incomplete, or poorly coordinated plan can create confusion, unnecessary expense, and conflict for your loved ones when they need guidance the most.
Here are five common estate planning mistakes that can cause problems for your family—and what you can do about them.
1. Waiting Until "Later" to Create an Estate Plan
One of the biggest mistakes people make is assuming they don't need an estate plan yet.
You might think:
"I'm still young."
"I don't have enough assets."
"I'll get around to it when I retire."
But estate planning isn't only about what happens after you die. A good plan can also address what happens if you become incapacitated and unable to make financial or medical decisions for yourself.
Unexpected accidents and illnesses can happen at any age.
Without the appropriate documents in place, your family may have to navigate court proceedings or make difficult decisions without knowing exactly what you would have wanted.
The best time to create an estate plan is before your family needs it.
2. Creating a Plan and Never Updating It
Life changes—and your estate plan should change with it.
Marriage, divorce, the birth or adoption of a child, the death of a beneficiary, a new home, a new business, or a significant change in your finances can all affect your estate-planning needs.
Even if nothing major has changed, it's a good idea to periodically review your plan to make sure it still reflects your wishes.
Ask yourself:
- Are the people I've named still the right people?
- Are my beneficiaries up to date?
- Have my assets or property changed?
- Has my family situation changed?
- Are my powers of attorney still appropriate?
- Does my plan still accomplish what I want it to accomplish?
An estate plan that made sense ten years ago may not make sense today.
3. Forgetting About Beneficiary Designations
Your estate plan isn't limited to your will or trust.
Many financial accounts—including retirement accounts and life insurance policies—have their own beneficiary designations.
Those designations can be extremely important because the beneficiary designation may determine who receives the account after your death.
For example, imagine you get divorced but forget to update the beneficiary designation on an old life insurance policy.
Your estate plan may say one thing while the beneficiary designation says another.
That's why your estate plan and your beneficiary designations should be reviewed together.
Don't assume that updating your will automatically updates every financial account.
4. Choosing the Wrong Person to Handle Your Affairs
Estate planning often involves naming people you trust to take on important responsibilities.
Depending on your plan, you may need to choose:
- A personal representative to handle your estate
- A trustee to manage a trust
- Someone to make financial decisions if you become incapacitated
- Someone to make medical decisions if you cannot make them yourself
- Guardians for minor children
These roles can involve significant responsibility.
The person who is great at managing family gatherings isn't necessarily the right person to manage a complicated estate.
Consider whether the person you choose is trustworthy, responsible, organized, and capable of handling difficult financial or family decisions.
You should also consider naming appropriate backups in case your first choice is unable or unwilling to serve.
5. Assuming a Will Is All You Need
A will can be an important part of an estate plan, but it may not address every situation your family could face.
Depending on your circumstances, your estate plan may also include:
- A revocable living trust
- Financial powers of attorney
- Medical planning documents
- Advance healthcare directives
- Beneficiary designations
- Business succession planning
- Asset protection strategies
- Planning for minor children
- Digital asset planning
The right combination of documents depends on your family, assets, goals, and circumstances.
An estate plan should be more than a collection of documents. It should be a coordinated strategy for protecting the people and things that matter most to you.
What Happens If You Don't Have a Plan?
If you die without an estate plan, Utah law determines how certain property is distributed.
If you become incapacitated without appropriate planning, your family may have to seek court involvement to obtain authority to make certain decisions on your behalf.
And even when you do have documents in place, an outdated or incomplete plan may not accomplish what you intended.
The goal of estate planning is to make things easier for your loved ones—not more complicated.
Don't Just Create an Estate Plan. Keep It Current.
Your estate plan should evolve as your life evolves.
A good time to review your plan is after a major life event, such as:
- Marriage
- Divorce
- Birth or adoption of a child
- Death of a loved one
- Purchase or sale of significant property
- Starting or selling a business
- Significant changes in your finances
- Changes in your family relationships
It can also be helpful to schedule periodic reviews even when nothing major has changed.
Protect Your Family Before They Need Your Plan
Estate planning is ultimately about more than property.
It's about making sure the people you trust can step in when needed, making your wishes known, and reducing uncertainty for the people you love.
At Allies Law Firm, our attorneys help Utah families create and maintain estate plans designed around their individual goals and circumstances. From wills and trusts to medical planning, powers of attorney, asset protection, and business succession, we can help you look at the bigger picture.
Don't wait until your family is facing a crisis to start planning.
The best estate plan is one that's created before it's needed—and reviewed before life changes make it outdated.