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Mistakes In Estate Planning Series - Part 1

Estate Planning is a complicated legal field. Even the most experienced attorneys often make costly mistakes. This first in a series of articles that highlights common estate planning errors that can derail even the best laid plans discusses the first 5 common pitfalls.

1. Having No Plan at All. Over 70% of Americans die without a valid will or any estate planning, resulting in complications, additional taxes and costs in both time and money. Without a valid will, the laws of the state where you are domiciled at the time of your death determine who will get your property, when they will get your property, and who will be t he person or public administrator to administer your estate and take care of any minor children. Rarely to these laws reflect what your choice would have been with proper advance planning.

2. Procrastination. Once a person recognizes the fact that they could benefit from some sort of estate planning, they often wait until it is too late. Unexpected death or disability can occur at anytime. It is never too early to develop a thorough estate plan.

3. Out-of-date Wills. Often, individuals and families draft wills and formulate estate plans early in life and fail to ever review them later. Of course, few among us go through life without significant changes in relationships and financial matters. Failure to conduct a regular estate plan review to ensure that plans reflect such changes can be disastrous. Shockingly, many wills list subsequently deceased people as guardians of minor children and executors of estates. Many include bequests to since-divorced spouses. And others fail to incorporate proper tax-minimization strategies to account for accumulated wealth.

4. Handwritten Wills. Maryland law recognizes a will entirely in the handwriting of a testator that is not attested by two witnesses (a "holographic will") only in very unique circumstances. Such attempts should be avoided to ensure validity.

5. Execution Errors. Every state has its own legal requirements for a will to be property and duly executed, and those requirements must be observed or the will will fail to be admitted to probate by any Court that has jurisdiction. The proper execution of a will in Maryland requires certain specific statutory formalities, including among other things that it be witnessed by two individuals, the testator specifically request that the witnesses sign it and that the witnesses sign in the presence of the testator. Many execution requirements are not commonly known and failure to observe them can invalidate a will.

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