MASSACHUSETTS ESTATE PLANNING: 7 COMMON ESTATE PLANNING MISSTEPS TO AVOID/THINGS YOU SHOULD NEVER SAY
- “I’ll definitely get to it tomorrow, or maybe next week, or next month….”
When it comes to estate planning, one of the biggest and most frequent mistakes people make is having no estate plan at all.
We’ve all heard the old adage “never put off until tomorrow what you can do today.” This is especially true when it comes to estate planning. If we have learned anything from the COVID-19 pandemic, it’s that things can change in an instant and nothing is guaranteed.
By putting a plan in place now that includes a last will and testament (and often an appropriate revocable living trust), you can let your family know how you want your assets to be distributed after you die. This can help to avoid arguments that can come up between family members who may not agree on who should get what after you are gone. In addition, in the event that you suffer from a disability during life which leaves you unable to manage your health care needs and financial affairs, a Durable Power of Attorney and a Health Care Proxy are invaluable documents to avoid the cost of a conservatorship and guardianship.
- “I can save money and do it myself.”
When we think of DIY projects, we probably visualize ourselves going to the local hardware store and picking up a can of paint, a drop cloth, and a roller to paint the living room, or stopping by the local nursey to buy some plants to start a vegetable garden.
Although there are certain projects that we can tackle ourselves to try to save a few dollars, there are limits to what most of us can accomplish without help.
For example, what would happen if we tried to self-administer Botox injections or install our own septic system? It sounds ridiculous, right? These examples may be extreme, but the point is there are reasons why individuals who perform certain types of work earn advanced educational degrees, undergo specific training and testing, and may be required to be licensed. The same holds true with legal work and estate planning.
In order to avoid the potentially disastrous consequences that can be caused by incomplete, inaccurate, and conflicting documents, working with a qualified estate planning attorney is your best bet.
- “Estate planning is for rich people.”
Every adult should have an estate plan regardless of the present value of their assets. Words to live by while keeping in mind that if you don’t have a Will in place when you die, state law will determine who inherits what property you do own and in what proportions. It will also be left to the Court to decide, without your input, such things as who will serve as your personal representative to handle your estate and who may be appointed as the guardians of your minor children.
In addition, the Federal estate tax threshold for deaths that occur in 2022 which currently stands at $12,060,000 (set to increase to $12,920,000 in 2023) is so high that the average person’s estate does not come anywhere close to that value. (In 2026, the current law sunsets and without further legislation, will return the exemption amount to $5 million, adjusted for inflation). If your estate is valued at more than $1,000,000 under Massachusetts law, it IS a taxable estate. For most Mass residents you don’t have to be uber-wealthy to reach that mark. Simply owning a modest home and/or having a retirement account can put you well over the threshold.
By consulting with an estate planning attorney, you can weigh the available options, such as the creation of revocable trusts to incorporate into your estate plan strategies and provisions designed to minimize your estate tax liability.
We invite you to call Gemma Law Office, PC today at (781) 380-8183 to schedule your free estate planning consultation.
- “Young people don’t need any estate planning documents.”
Again, not true.
In order to execute a valid Will in Massachusetts, the two required witnesses must attest to the fact that:
- The person signing is at least 18 years of age or older;
- The person signing is of sound mind; and
- The person signing is under no constraint or undue influence.
While your typical 18-year-old may not yet need a Will, it is a great idea for them to have a Power of Attorney and Health Care Proxy in place. That way, in the event of an accident or injury, the named agent (which, if they choose, can be Mom or Dad) will be able make decisions and act on their behalf without court involvement whether they are living at home, independently on their own, or away at college.
- “I’ll name my spouse or partner to be my fiduciary and I don’t need a back-up.”
Naming your spouse or partner to be in charge of your estate or make your health care decisions and handle your finances if you can’t do so yourself is often the clear first choice. But naming a successor in the event that your first choice is unavailable can save your family a great deal of grief.
We often think that as long as our first choice is still living when the times comes for them to step up and act, we are all set. But, in the meantime, if your first choice should become incapacitated or, for a variety of reasons, isn’t up to serving, without a second nominee, you are left with no back-up alternative.
Additionally, although your spouse or significant other is often a great choice, it is also possible that, depending upon the individual, they may find the complexities of the probate process and the duties of the fiduciary overwhelming or too challenging. Maybe they aren’t comfortable with, or adept at, handling financial and investment accounts which often goes hand-in-hand with administering an estate or trust. In that case, they may not be well-suited to be your fiduciary.
Regardless of who you select as your first nominee, it is wise to discuss with your estate planning attorney including a back-up successor whenever possible.
- “I don’t need to check with people before I nominate them to serve as my agent.”
Sometimes an elderly relative, perhaps unmarried and without children, decides to update their Will and nominate their favorite niece or a nephew who lives clear across the country to serve as the personal representative of their estate.
Even though the person selected may wish to honor that request, it is definitely a good practice to ask people if they will be able to take on the role for which they have been selected when the time comes. For example, it may be impractical, for a personal representative to administer an estate, manage real estate holdings, and otherwise oversee and distribute assets from far away. It may also be impossible for that person to take time away from their own family and to be away from their job in order to travel back and forth to and from their home state.
In the absence of a trusted family member or friend who is ready, willing, and able to serve, there are alternative options that you can discuss with your estate planning attorney such as nominating a licensed attorney to serve as your fiduciary or choosing a professional or corporate fiduciary.
- “I’ve done my estate plan and I never need to look at it again.”
Once you have put an estate plan in place, it may be tempting to lock the documents up in your fireproof cabinet never to be thought about again. However, you should review your estate plan with your estate planning attorney every three to five years, or sooner in the event of a life change, such as marriage, divorce, the birth of a child, the purchase of a home, a change in health status, or a change in financial status, to name just a few.
You should also be sure to let your nominee or trusted individual know where the original documents are kept so that they may be retrieved at the appropriate time.
Avoid the 7 common estate planning missteps
If you are looking for an experienced Massachusetts will, trust, and probate attorney to guide you through the estate planning process, Gemma Law Office, PC is here to help. Contact Gemma Law Office, PC today at (781) 380-8183 to find out what we can do for you.
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