6 common estate planning mistakes to avoid

When it comes to estate planning, it’s crucial that the correct steps and decisions are made to ensure you and your family are well set up when the time comes – whether that be as a result of unfortunate circumstances such as sudden death, an acute incident such as a stroke, or a serious illness such as dementia, which may require you to consider out-of-home options like aged care.

There are a number of things to consider when estate planning and it is important to follow best practice guidelines when making decisions of this magnitude.

Given the important nature of estate planning decisions, it’s important to be aware of the common mistakes people make when organising their estate so that they can be avoided at all costs.

1. Accept the inevitable

Many people put off estate planning with the belief that they will have the time to get around to it. However, this treads into dangerous territory of being unprepared for the worst.

A vital fact to acknowledge is that the ultimate equaliser comes for us all. In fact, there are three things you can say about death – you never really know when it’s going to happen; it will happen; and, once it’s happened, it will never happen again.

Getting past this vital first step is how you can avoid delaying your estate planning needs until it’s too late.

2. Doing nothing

Doing nothing to confront it has its attractions – it’s easy to do and it’s cheap. The trouble is that too many of us concentrate on the price of doing something as opposed to the cost of doing nothing.

The cost of doing nothing will always exceed the price of doing something. Perhaps it may not bear any consequences for you, but your loved ones will suffer the brunt of any missed steps. For their sake, it’s always best to get started and do something, rather than nothing.

3. Do it yourself

In raising the flag for the self-help movement and, in an effort to be cost effective and efficient, choosing to do your will yourself is alluring. How hard can it be?

However, it’s important to understand that the law of wills is strewn with legal technicalities and failing to comply with the technicalities will simply result in legal proceedings for everyone else. This could result in problematic misunderstandings and lengthy discussions about how to settle your estate.

4. Losing it

This has two aspects. First, if you have done a will but don’t know where it is, you may as well assume you haven’t done a will. Get back to drafting one with your trusted legal team ASAP.

Second, if you leave it too late, it may no longer be a viable option. Death isn’t the only reason you may not be fit to make a will — it could also be because you may lose your capacity.

5. Being creative

No doubt you have heard many stories about various ways people like to leave their last testament, including writing it with a felt pen on their bedroom wall, texting themselves or creating a video for their last will.

Treating your will as a work of art will result in it foundering on the rocks of legal technicalities. Such alternatives will not always be accepted as a valid will unless a court says so. The consequence of that is, someone may have to bring your bedroom wall to a Court for it to determine whether it is indeed your last Will and testament. Your family will love you for that!

6. Not caring about the legacy of relationships

Some people will want to use a will as a statement of repressed opinions. It’s not just about who to give what to. The most profound impact of a will (and particularly, no will) is its effect on relationships within your family left here on earth.

How you divvy up what you pass on, and what you declare or write, can have long-lasting and potentially devastating outcomes on the relationships between your loved ones. Just keep that in mind when you’re drafting up your will.

IMPORTANT LEGAL INFO This article is of a general nature and FYI only, because it doesn’t take into account your financial or legal situation, objectives or needs. That means it’s not financial product or legal advice and shouldn’t be relied upon as if it is. Before making a financial or legal decision, you should work out if the info is appropriate for your situation and get independent, licensed financial services or legal advice.