If your estate plan is contested it could end up in probate court. Depending on the complexity of your will and other documents, this process can be lengthy (and rack up legal expenses as a result). However, there are steps you can take to prevent your will from being contested, such as by making sure there are no mistakes in your estate plan. Kiplinger offers guidance on how to do just that, which benefits your estate as well as your family.
Neglecting Beneficiary Designations
Retirement accounts and life insurance policies are all part of your estate. Accordingly, leaving the proceeds of these assets to your loved ones after you die requires naming beneficiaries (which ensures that your chosen heirs will receive a part of your estate). If you don’t name any beneficiaries, it will be up to the court to decide. This can be a real issue if your estate has any debt associated with it, as creditors may go after these assets to recoup.
Leaving Assets to Minors
While it’s certainly acceptable to leave assets to minors, you want to make sure you put certain clauses in place to mitigate any issues. For instance, you can mandate when the assets should be distributed to prevent frivolous spending (which is a risk when very young people receive an influx of money). You can also create protections to prevent minor heirs from being taken advantage of by their guardians.
Ignoring Tax Issues
Taxes are a concern when it comes to your estate. In this case, it’s best to divvy up assets between spouses to keep tax burdens manageable. This is especially important of one spouse has a more extensive work history than the other. This will mean a greater individual retirement account, which will only serve to increase taxes.