Many people assume that once they sign their estate planning documents, they're finished.
Often, they're not.
Some of the most expensive estate planning mistakes happen because assets were titled incorrectly.
1. Adding a Child to the House Deed
Many parents believe this avoids probate. Instead, it gives the child an ownership interest today, potentially exposing the property to their divorce, creditors, or bankruptcy. It may also eliminate valuable tax benefits, including a stepped-up basis.
2. Naming a Minor as a Beneficiary
Life insurance companies and financial institutions generally cannot distribute assets directly to a minor. Instead, a court-supervised guardianship may become necessary, followed by the child receiving full control of the funds at age eighteen.
3. Creating a Trust but Never Funding It
This is one of the most common mistakes I see. A trust only controls assets that have actually been transferred into it. If your home, bank accounts, or investment accounts remain titled in your individual name, those assets may still go through probate.
4. Not Understanding Beneficiary Designations
Terms such as "per stirpes" can dramatically change who inherits your assets if a beneficiary dies before you. Many people sign beneficiary forms once and never review them again.
The good news is that these mistakes are usually preventable. Estate planning isn't only about signing documents—it's about making sure your assets are properly titled and your beneficiary designations reflect your current wishes.
Take some time this month to review your deed, your account titles, and your beneficiary forms. A simple review today can prevent costly problems for your family tomorrow.
This article is for educational purposes only and does not create an attorney-client relationship.