Common Mistakes with Estate Planning Documents

Practices for Preventing Financial Errors

A number of client financial planning reviews over the past month have led to the detection of mistakes involving client estate planning documents. These errors underscore the importance and value of having an organizational platform, such as eMoney, and validate why we are so persistent in hounding FPH clients to provide us with copies of estate planning documents, beneficiary designations, employee benefits summary statements, etc.

In terms of specific examples, after a couple of years of gentle reminders, a client in Texas provided us with copies of his and his wife’s estate planning documents. The review revealed that their Medical POA was out of date, they had not drafted a durable power of attorney, and the people named in the documents to serve as their successors/representatives/alternate agents had never received copies of the documents in which they were named.

In another example, a couple in Massachusetts provided copies of their estate planning documents for review and inclusion in eMoney. A review of the documents revealed a dated health care proxy, a dated hand-written living will, and a trust document listing a beneficiary who is now estranged from the family. The trust document also listed a local bank with which the couple has no functional relationship as a successor trustee and personal representative upon the death of both spouses.

If you think these “catches” are not a big deal, think again – they are critical, and the consequences of not catching them may be severe. To be clear, my role as the financial planner is not to provide specific legal advice on such matters. However, it is a valuable function of the financial planner (at least the good ones) to seek out and raise awareness of such issues.

Dates to Remember (When it Comes to Updating Your Estate Plan)(WealthManagement.com)

Avoiding Estate Planning Gotchas (WealthManagement.com)