Estate planning is an essential part of ensuring that your assets are properly distributed and your loved ones are taken care of. However, many people make common mistakes during the estate planning process that can lead to complications, financial loss, and stress for their families. In Buffalo, these mistakes are not uncommon, and avoiding them can save you and your family a great deal of trouble. Whether you’re drafting a will, setting up a trust, or considering healthcare directives, it’s crucial to make informed decisions. Here are some of the most common estate planning mistakes people make in Buffalo and how to avoid them.
Robert Friedman
Michael Ranzenhofer
Sam Alba
Justin Friedman
John Dracup
Failing to Update Your Estate Plan Regularly 
One of the most significant mistakes in estate planning is failing to review and update your estate plan regularly. Life is full of changes, and many of these changes should be reflected in your estate plan. For instance, if you get married, divorced, or experience a major shift in your family dynamics, these events should trigger a review of your will or trust. Additionally, if you acquire significant assets, such as a home or business, or if your financial situation changes dramatically, your estate plan may need to be updated to reflect these new circumstances.
In Buffalo, it’s important to be proactive about this. Many individuals neglect to update their estate plan after significant life changes, which can lead to assets being distributed in ways that no longer reflect their wishes. For example, an ex-spouse might remain a beneficiary on a life insurance policy if the beneficiary designation isn’t updated after a divorce. Keeping your estate plan up to date will ensure that your wishes are followed and that your assets go to the right people.
Overlooking Healthcare Directives
Another common mistake in estate planning is overlooking healthcare directives, such as a healthcare proxy or living will. These documents are vital in ensuring that your medical wishes are followed if you become incapacitated and cannot make decisions for yourself. Without these directives, your family may have to make difficult decisions about your care, potentially leading to disagreements among loved ones or confusion about what you would have wanted.
In Buffalo, it’s essential to have clear healthcare directives in place, especially considering that healthcare decisions can quickly become a matter of urgency. A living will allows you to outline your preferences for medical treatments in various situations, while a healthcare proxy designates someone to make decisions on your behalf if you’re unable to do so. These documents give peace of mind to both you and your family and ensure that your medical care aligns with your wishes, even in the event of a medical emergency.
Ignoring Certain Assets in Estate Planning
A major pitfall in estate planning is failing to account for all of your assets. Many people focus on their real estate or bank accounts, but they overlook non-probate assets like retirement accounts, life insurance policies, and joint accounts. These assets do not go through probate and are often automatically transferred to the designated beneficiary, but that doesn’t mean they shouldn’t be part of your estate planning process.
If you do not update the beneficiaries on these accounts, you risk having them go to someone other than your intended heirs. In Buffalo, failing to account for these assets can lead to unexpected outcomes. For instance, a retirement account may still have a beneficiary designation that reflects your first spouse, even if you’ve since remarried. A thorough estate plan should include a review of all your assets, ensuring that beneficiaries are properly named and that your estate is organized in the way you desire.
Not Planning for Estate Taxes
Estate taxes can take a significant portion of your estate, and without proper planning, your family may be left with a large tax bill. In New York, estates valued over a certain threshold are subject to estate taxes. If you don’t plan for these taxes, they can eat away at the value of your estate, leaving your heirs with less than you intended.
Many people in Buffalo fail to plan for estate taxes because they don’t realize how much they can impact their estates, especially for higher net-worth individuals. To minimize estate taxes, consider strategies like gifting assets to heirs during your lifetime or setting up a trust that can reduce the taxable value of your estate. An estate planning attorney can help you navigate the complexities of estate taxes and ensure that your family doesn’t bear an unnecessary financial burden after your death.
Choosing the Wrong Executor
The executor of your estate is the person responsible for carrying out the instructions in your will and managing the distribution of your assets. Choosing the wrong executor can cause delays, disputes, and confusion during the probate process. It’s crucial to select someone who is trustworthy, organized, and capable of handling the responsibilities of administering your estate.
In Buffalo, many people make the mistake of naming a family member or friend who may not be suited for the role. While it’s common to choose a close relative or trusted friend, make sure that the person you select understands the duties of an executor and is capable of managing your estate efficiently. If you don’t have a suitable person in mind, you can also name a professional, such as an attorney or financial advisor, to serve as your executor.
Neglecting to Establish a Trust
A living trust is one of the most effective tools for avoiding the lengthy and expensive probate process. A living trust allows your assets to pass directly to your beneficiaries without court involvement. Many people in Buffalo skip this step, thinking it’s unnecessary or too complicated. However, without a trust, your estate may go through probate, which can be a lengthy and costly process.
Setting up a trust also provides privacy because it doesn’t become part of the public record, unlike a will, which can be accessed by anyone. If you own property, have minor children, or wish to avoid probate, a trust can be an essential part of your estate planning process. An estate planning attorney can help you create a living trust that meets your specific needs.
Not Seeking Legal Advice
While it’s tempting to use DIY estate planning tools or rely on online templates, these can often lead to errors or incomplete planning. Estate planning is a complex legal process that requires careful consideration of your assets, your family situation, and your long-term goals. Working with an experienced estate planning attorney in Buffalo ensures that your documents are legally sound and that your wishes will be carried out as you intend.
At Friedman & Ranzenhofer, our team of estate planning attorneys can help you navigate the process, avoid common mistakes, and create a comprehensive plan that reflects your unique needs. Estate planning is not a one-size-fits-all process, and professional legal guidance can make sure that your plan is tailored to your situation.
Estate planning is essential for ensuring that your assets are distributed according to your wishes and that your loved ones are protected. Avoiding common estate planning mistakes in Buffalo requires regular updates to your plan, consideration of all your assets, and planning for healthcare decisions and taxes. Choosing the right executor, establishing a trust, and seeking professional legal advice are also crucial steps in creating a comprehensive estate plan.
If you haven’t yet created your estate plan or need to review and update your existing documents, now is the time to act. Contact Friedman & Ranzenhofer, PC today for a free consultation and ensure that your estate is properly planned for the future.