Estate Planning Dos and Don'ts

4. Do Establish a Durable Power of Attorney
If you are incapacitated, you can designate a trusted family member, friend, or professional to do it for you. By assigning a power of attorney, you can ensure that payments and taxes are always made on your real estate properties, and that all necessary paperwork is filed and organized.

There are also a few don’ts you want to keep in mind when you’re crafting your estate plan.

1. Don’t Keep Your Estate Planning Lawyer Out of the Loop
The risk of triggering tax and legal problems is very real. If you transfer real estate assets out of a trust, buy or sell property, or otherwise change your real estate portfolio, make sure you let your estate planning attorney know.

2. Don’t Assume Your Bank Keeps Track of Real Estate Documents
It’s your responsibility to monitor all of your real estate paperwork. Companies merge, diverge, collapse and move around all the time, especially in this lousy economy. Don’t assume that your mortgage bank or lender is making the safe storage of your property title and other paperwork a high priority. If, in the maelstrom of the moment, your property documents are misplaced, misfiled, or inaccurately recorded by a new company, your heirs will have a major headache.

So once a year, contact your mortgage lender and ask for a copy of key documents, like titles, deeds, and beneficiary designations.

3. Don’t Forget to Have a Back-Up Plan
Few folks want to consider it, but there is a possibility that you may out live your beneficiaries. As a result, some thought and planning should be applied to a Plan B, i.e., who your heir would be should your primary beneficiaries predecease you. Usually that means a different family member or friend, and that’s jut fine. The key is having that contingency plan in place so that you have a named beneficiary. If not, the state will step in and name one for you.

If you keep these dos and don’ts in mind, your estate planning process will be significantly easier to manage, more effective in its execution, and save you and your loved ones time and money.