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Avoiding estate planning mistakes

On Behalf of | Jun 27, 2019 | Estate Planning

One of the many estate planning mistakes that Georgia residents should avoid is designating minors as direct beneficiaries. People under the age of 18 cannot receive assets from an estate directly. It will be necessary to appoint a guardian who can hold and maintain the assets on behalf of the minor. A custodian or trustee for minor beneficiaries can be named in a will in order to avoid time and costs of a guardianship.

Another estate planning error to avoid is creating a revocable trust without funding it. A revocable trust can be used to privatize information about an estate’s beneficiaries and assets, but it has to be funded during the creator’s lifetime. Individuals should reevaluate their assets to determine which ones should be transferred under the ownership of the trust and make sure to transfer the assets during their lifetime.

Individuals should also refrain from listing minors’ names on accounts. Many people tend to do this in order to avoid the probate process; however, this can sometimes result in complications. For example, for parents who have jointly held accounts with one of their minor children, when the adult owner of the account dies, the joint account will pass solely to the minor whose name is on the account instead of being reallocated equally to all of the children. If the minor account holder has financial or legal difficulties, the funds in the account may be subject to seizure by the creditors. Also, if the minor account holder predeceases the parent, the account may have to go through the probate process.

Individuals working with an estate planning attorney may have help devising an estate plan tailored to their wishes. Assistance may be provided for developing strategies for avoiding the probate process and for drafting the appropriate types of powers of attorney, wills and trusts.

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