Ventura and Santa Barbara estate planning lawyer

Common Estate Planning Mistakes Made by High-Net-Worth Individuals

No matter your level of income, having a comprehensive estate plan is one of the most important steps you can take to secure the future of your loved ones and your assets. However, even among high-net-worth families, studies show that nearly 40 percent have not engaged in sufficient financial and estate planning.

It takes the assistance of a professional and experienced estate planning attorney to be able to cover all the issues that tend to come up when planning for a high-value estate. Seeking professional guidance can help you avoid the following common mistakes that high-net-worth individuals make during this process:

  •     Invalid and outdated wills and trusts: Many people have outdated wills or living trusts that no longer reflect their current life circumstances. It’s important to at least read through your will or trust annually to remain familiar with its contents. You should make updates after marriage, divorce, a birth of a child, death of a loved one or significant changes in your financial situation.
  •     Not thinking through how you’ll distribute assets: People tend to focus on who is getting how much, but not how that money will get passed down. Estate planning is about more than determining who gets which assets or how much cash. You must also determine how you can pass these assets on in a way that minimizes your tax obligations, how you will successfully transition a business to a new owner, and consider the effect of the inheritance on the beneficiary .
  •     Failing to use a holistic estate planning approach: Rather than having advisors working on separate portions of an estate plan independently of one another, you should have a team of professionals working together in a way that provides an interconnected, well-organized plan that takes all your needs into account. All elements of your estate plan should work in concert.
  •     Not using lifetime trusts: These trusts are, at their core level, trusts inside of trusts. They are arrangements made with the trustor to manage assets upon his or her death. The trustee can then distribute the trust’s income and capital according to the terms of the trust to each beneficiary. It’s important to note that this arrangement places a lot of responsibility on the trustee, so anyone carrying out that role should be trustworthy, organized and competent.
  •     Neglecting family members during the process: Too many families have a lack of communication about estate planning, which can ultimately cause some significant arguments. This situation is particularly the case in high-net-worth families. It is imperative that you have frank discussions with your loved ones about your estate plan and the decisions you’ve made to avoid any surprises or misunderstandings.

These are just a few of the most common mistakes high-net-worth individuals make when working through their estate plans. Be sure to consult a qualified attorney to ensure you get the results you need out of this important process.

Schedule Your Consultation with Our Experienced California Estate Planning Attorneys

Bartlett & Herrington, P.C. is a top estate planning law firm in Carpinteria, California. Our attorneys help families set up living trusts, wills, power of attorneys, healthcare directives in Santa Barbara, Ventura and Montecito. We also serve clients in probate, elder law, Medi-Cal planning, retirement planning, asset protection, and Veterans Affairs (VA) aid and attendance planning.

Schedule a planning session with our experienced attorneys today to learn how we can help you and your family: (805) 576-7693.

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