Wills are crucial documents that dictate how an individual’s assets are distributed upon their death. Despite their importance, only 24 percent of Americans have a will, according to research from Caring.com. Moreover, many existing wills may contain outdated provisions due to changes in estate laws or shifts in individual circumstances. Legal experts emphasize the necessity of regularly reviewing wills, especially after significant life events.
According to Jaclyn Roberson, a senior partner at Roberson Duran Law, individuals should consider updating their wills following any major life change. This includes events such as the death of a family member included in the will or the birth of a new child or grandchild. “People should review their wills any time they experience a life-changing event after the will has been prepared,” Roberson stated.
Experts have identified three common mistakes that retirees often make in their wills, highlighting the need for careful consideration and revision.
1. Sensitive Information Inclusion
One prevalent issue in many wills is the inclusion of sensitive personal information. Details such as credit card numbers, bank account information, Social Security numbers, and vehicle identification numbers (VIN) can inadvertently become public records when a will is filed during the probate process. Roberson cautions against this practice, noting, “Out of an abundance of caution, do not include account numbers, Social Security numbers, or credit card numbers in your will.” While some states allow for sealing probate records, this protection is not universal, making it essential to safeguard personal data.
2. Excess Co-Executors
Another common pitfall involves naming too many co-executors. When individuals designate multiple heirs as co-executors of their estate, it can complicate the distribution process. Somita Basu, a partner at Norton Basu LLP, explains that this practice often stems from a desire to avoid offending family members. “Seniors often make the common mistake of making multiple children co-executors, so as not to offend anyone,” Basu noted. This can lead to disputes and potentially costly legal battles.
Legal advisor Nathan Wente from Real Estate Bees supports this view, stating, “By naming more than one person, you are creating a ‘too many cooks in the kitchen’ scenario.” Naming multiple co-executors can also increase legal fees, as Wente points out, “I will charge a higher fee to assist in probates where I have to have more than one client.”
3. Avoiding Disinheritance Conflicts
Retirees sometimes assign minimal monetary gifts to estranged family members to avoid the appearance of disinheritance. However, even small amounts can lead to complications during probate. Allison Harrison, an attorney at ALH Law Group, explains that providing even a nominal sum to an excluded individual can give them grounds to contest the will. “We see frequently a child, who is estranged from the parents, challenge a will because they are not mentioned at all or given a nominal amount,” she explained.
Instead of this approach, Harrison recommends explicitly disinheriting individuals and providing a detailed explanation for their exclusion. Alternatively, she suggests offering a more substantial amount, which may deter challenges, such as leaving $10,000 from a $250,000 estate among multiple beneficiaries.
These insights underscore the importance of careful estate planning for American retirees. Regularly reviewing and updating wills not only helps protect personal information but also ensures that the distribution of assets aligns with current wishes and family dynamics. By avoiding these common pitfalls, retirees can navigate the complexities of estate planning with greater ease and security.
