3 Common Estate Planning Mistakes

April 20, 2012 — 1,361 views  
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Bequeathing property and funds to your family seems easy enough, but many people make some common mistakes when drafting wills and planning for their loved one's futures.  Avoid making these missteps when taking care of your last will and testament.

Be clear
You might think your family is going to be civil when it comes time to distribute your estate, but don't put them in a position where they may end up fighting over it. Be exceedingly clear about which accounts will be distributed, what property is to be sold and how your funds must be treated.

Take advantage of exemptions
The IRS allows for $13,000 worth of tax-exempt gifts to be made each year, which is a great tool for reducing the size of your estate. This has the effect of minimizing the effects of estate taxes and allows you to financially help your family before you've passed away.

Name beneficiaries
It's relatively easy to designate heirs who will receive your liquid assets and properties, but retirement accounts and pensions aren't so clear-cut. Be sure to outline in detail which family members will become the beneficiaries of any annuities, IRAs, 401(k)s and other finances you may possess.