What Not to Do When Estate Planning: What Your Attorney Wishes You Knew

Having an estate plan, even an imperfect one, is usually better than having no plan at all. But an existing plan can still have serious flaws that defeat its overall goals or objectives. A plan based on misperceptions, including the idea that estate planning must be perfectly timed, can be nearly as problematic as putting off planning altogether.

If it has been a while since you revisited your estate plan, or if you are still waiting to get started, knowing what not to do can help you avoid mistakes that may doom an estate plan to failure.

Why Americans Put Off Estate Planning

The numbers suggest that Americans are more likely to complete the following unpleasant tasks than they are to create an estate plan:

• Going to the dentist. Roughly 71 percent of US adults make an annual trip to the dentist’s chair as compared to the approximately 24 percent of adults who have a will.
• Deep cleaning. Eighty percent of Americans take on major spring cleaning projects each year, making even tasks such as toilet scrubbing more popular than creating estate planning documents, which by comparison, only 44 percent of US adults have.
• Filing taxes. Tax preparation may be universally dreaded, but the Internal Revenue Service (IRS) estimates that around 85 percent of federal taxes are paid voluntarily and on time.
• Visiting the Department of Motor Vehicles (DMV). Few bureaucratic errands are more routinely mocked than a trip to the DMV, yet about 87 percent of driving-age Americans maintain an active driver’s license.

What is it about estate planning that lends itself to inaction? It could be that the planning process forces us to think about uncomfortable topics such as our own mortality. But the reasons people give are generally more practical. Procrastination remains the order of the day, followed by several assumptions that suggest basic misunderstandings about estate planning. These assumptions include not having enough assets to leave anyone, not having someone to leave assets to, uncertainty about how to set up a will or living trust, cost considerations, and time and effort. Seventeen percent of Americans simply say that they “don’t know” how to get started with planning, while almost a quarter say “nothing” would motivate them to start.

Common Estate Planning Mistakes to Avoid

Delaying estate planning can make things more difficult later. Without your own instructions in place, state law and default procedures may determine what happens to your property and who makes decisions on your behalf.

The best time to plan is right now. Here is what your attorney wishes you knew about estate planning, and why it matters.

Mistake: Waiting for the Perfect Time to Plan

One of the most common estate planning mistakes is assuming that you need to reach a certain age, accumulate a certain amount of wealth, or feel fully prepared before creating a plan. Many people treat an estate plan like a milestone reserved for retirement, a windfall, or some other life-altering event, but procrastination often comes down to two foundational misconceptions.

Assuming That Estate Planning Is Only for the Wealthy or Older Adults

Estate planning is not just about high-net-worth tax strategies; it is also about simpler decisions such as deciding what happens to your property, choosing who can handle your financial and legal affairs, and naming guardians for young children. If you own a home (or anything of value, monetary or sentimental), hold a bank or retirement account, or have minor children or a beloved pet, you have reasons to plan.

When someone dies without an estate plan, state law may determine who receives their property. Those one-size-fits-all rules do not cover every family dynamic, preference, or personal priority. And they may unintentionally produce a result different from what you would choose.

Even professionals who advise clients on their finances see how much careful tax and gift planning shapes a good estate plan. One CPA put it this way:

Waiting Until a Health Scare Forces the Issue

Around one-third of Americans say a health scare would motivate them to get a will, but by then it may be too late.

A sudden diagnosis, surgery, or accident can create an urgent rush to put legal paperwork in place. However, the person wanting the estate planning documents still needs sufficient mental capacity to understand and execute those documents, and waiting for a crisis could mean that capacity is already lost.

Trying to prepare powers of attorney, healthcare directives, or a will during a sudden medical decline can add unnecessary strain for everyone involved. It may also raise questions about whether the documents were properly executed.

Waiting for the right time assumes that you will get advance warning. A plan put in place early and updated over time usually gives you more options than an urgent effort during a crisis.

Mistake: Assuming a Will Covers Everything

A will is a legal document that explains who should receive certain property after you die. It is a solid starting point, but it may not cover all your assets because some are controlled by separate beneficiary or ownership arrangements.

Overlooking Beneficiary Designations

Assets such as 401(k)s, individual retirement accounts (IRAs), life insurance policies, and financial accounts with transfer-on-death (TOD) or payable-on-death (POD) designations generally pass according to the beneficiary designation on the account.

If a will says that your estate goes to your current spouse, for example, but an older 401(k) or life insurance policy still lists a sibling or former spouse as the primary beneficiary, the beneficiary designation will typically control where those funds go.

Ignoring Jointly Owned Property

Property owned with another person may pass automatically to the surviving owner instead of according to the instructions in a will, depending on the type of ownership interest each owner has. This can apply to jointly owned homes, bank accounts, or other real estate. The exact result depends on how the property is titled and on state law.

For example, if you attempt to leave your share of a jointly owned home to a child in your will but the property deed grants your spouse automatic inheritance rights, your spouse will almost certainly become the sole owner. This occurs because the majority of jointly owned real estate includes a right of survivorship. Under this legal structure, the last surviving joint owner automatically becomes the sole owner of the property without requiring court involvement.

Confusing a Will with a Comprehensive Estate Plan

A standalone will takes effect only after death. Depending on the estate and how its assets are titled, the family may need to go through probate, the court process for settling an estate.

A comprehensive estate plan also addresses lifetime protection. Documents such as financial powers of attorney and healthcare directives can provide direction if you become unable to make decisions for yourself due to incapacity. A standard will is not designed to do that because it comes into effect at death, which can leave a major planning gap.

Mistake: Relying Too Heavily on DIY Estate Planning

Online templates and software can make a do-it-yourself approach seem simple. Such tools may work for straightforward situations, but standard forms do not always account for differences in state laws, family circumstances, existing documents, or more complex planning needs.

Using Generic Forms That Ignore State-Specific Laws

Estate planning laws vary by state. Requirements for signing legal documents, witness rules, spousal inheritance rights, and power of attorney requirements can differ from place to place. A generic online document may not comply with local requirements or accomplish your planning goals.

Creating Conflicting or Incomplete Documents

Creating self-drafted estate planning documents often leads to unintended conflicts with existing accounts or prior arrangements, particularly when they fail to address both lifetime incapacity and the eventual distribution of your estate.

For example, simply executing a trust document does not automatically transfer your assets into it. Certain property must be explicitly retitled or transferred separately, which is a process known as funding the trust. If assets are left unassigned, the trust loses its authority over them. Furthermore, documents that contain conflicting instructions or lack proper signatures inevitably create severe delays and confusion for your beneficiaries and appointed decision-makers.

State-specific rules are one reason more complicated situations, such as an estate that spans more than one state, benefit from experienced guidance. As one client, an attorney himself, shared:

Mistake: Letting Your Estate Plan Go Stale

Creating an estate plan is not a one-and-done project. Life changes, and plans should reflect that. A plan that has not been updated to accommodate shifting circumstances can end up directing assets or assigning responsibilities in ways that no longer make sense.

Failing to Update After Major Life Transitions

An estate plan should evolve alongside your life and finances. It is recommended that you periodically review your documents, particularly after the following major milestones:

• Births or deaths. Ensure that new children or grandchildren are planned for, or update roles if a named executor, agent, or backup decision-maker passes away or becomes unavailable.
• Divorce or remarriage. Reassign beneficiaries and decision-makers to reflect current family structures.
• Relocation. Review your documents after moving to a new state.
• Financial changes. Account for new real estate, business interests, or notable asset changes.

Regular reviews are much easier when you have a long-term relationship with your planning team. One family we have worked with for years described it this way:

Mistake: Avoiding the Hard Family Conversations

Family dynamics are where plans can encounter the most friction. Avoiding candid discussions during the planning process can lead to misunderstandings later. The technical details of wills and trusts often depend on conversations that take place beforehand.

Hiding Family Dynamics from Your Attorney

Attorneys can address only the issues they know about. For example, if there are strained relationships, blended family considerations, estrangements, or concerns about how a beneficiary might manage an inheritance, sharing those details can help your attorney recommend options that better fit your actual situation.

Choosing Representatives Based on Emotion Rather Than Fit

Naming an executor, trustee, or guardian based on birth order or out of obligation or guilt can lead to unintended but avoidable problems.

The eldest adult child may not be the person best suited to manage complicated paperwork, and a close relative may not have the time or practical ability to take on a demanding role. Closeness does not always equal a good fit.

Your decision-makers should be chosen based on reliability, organization, judgment, and practical availability, not just to avoid hurt feelings or satisfy a sense of obligation. You are choosing people to help fulfill your legacy. Choose wisely and do not be afraid to change your mind for any reason, at any time.

Your estate plan does not have to be perfect to be beneficial. Starting now, while you can make and explain your decisions, gives you more options and time to adjust your plan as life changes.

Estate Planning Mistakes FAQs

What is the most common estate planning mistake?

One of the most common mistakes is waiting for the “perfect” time, such as reaching a certain age, building a certain amount of wealth, or facing a health scare. By then, the mental capacity needed to sign documents may already be in question.

Does a will cover all of my assets?

Not always. Accounts with beneficiary designations, such as 401(k)s, IRAs, life insurance, and TOD or POD accounts, generally pass to the named beneficiary. Jointly owned property with a right of survivorship usually passes to the surviving owner, regardless of what the will says.

Are DIY estate planning forms enough?

They may work for simple situations, but generic forms may not follow your state’s signing and witness rules or fit your family’s needs. For example, signing a trust does not automatically move assets into it; certain property must be retitled, a process known as trust funding.

How often should I update my estate plan?

Review your documents periodically and after major milestones, including births or deaths, divorce or remarriage, a move to a new state, and notable financial changes such as new real estate or business interests.

How should I choose an executor or trustee?

Choose decision-makers based on reliability, organization, judgment, and practical availability, not birth order, obligation, or guilt. You can change your choices at any time as circumstances change.

Gunderson Law Group, P.C.

Arizona Location
1400 E Southern Ave Suite 850
Tempe, AZ 85282
Office: (480) 750-7337
Email: [email protected]