Statistics show that an astounding 64 percent of Americans currently have no estate plan, meaning they have no formalized plans in place for their assets, their health care wishes or even their children should they pass unexpectedly.
In past posts, we've discussed the various reasons as to why so many Americans are putting off the execution of even a simple will from the mistaken belief that estate planning is somehow reserved for the wealthy or that they are still too young to need to consider planning for their demise.
However, what about the 36 percent of Americans who do have an estate plan in place? While they are certainly to be commended for taking the time to plan for the future, are they doing enough regarding their existing estate plans?
In today's post, we'll examine a very common estate planning mistake made by those who fall within this 36 percent.
While the temptation is certainly there to forget all about an estate plan once it's finally finished, the simple reality is that life can change in the ensuing years and estate planning documents must be amended to reflect these changes.
For instance, marriages can end, kids and grandkids can be born, businesses can go bankrupt, people can die and economic circumstances can change.
Failing to account for these major life changes could potentially jeopardize your prior wishes, and create both heartache and headaches for your intended heirs.
For instance, it's not uncommon for spouses from second marriages and children from first marriages to get into major inheritance disputes if the necessary changes aren't made to an estate plan.
"Your estate plan can protect your children if you die first, so your second spouse doesn't leave them with nothing," said one estate planning attorney. "You can also protect your spouse and children from lawsuits and unscrupulous 'friends.'"
If you would like to learn more about updating your estate plan, consider speaking with an experienced legal professional who can explain the law, examine your change in circumstances and outline your options moving forward.
Source: Forbes, "7 common estate-planning blunders not to make," Sheryl Nance-Nash, Sept. 15, 2014