Estate planning mistakes to avoid with significant assets
Estate planning can be more difficult when you have significant assets. Your situation is more complex, and as a result, you need more detailed planning.
Due to the complexity, you may be more likely to make mistakes while estate planning, especially if you are doing it by yourself. Kiplinger identifies some mistaken thinking that people get into while estate planning that can cause you to make bad decisions.
Leaving everything to your children
If your children are minors, obviously you have to provide for their financial maintenance in the event of your death. However, if your children are adults, you have no obligation to leave them everything. You do not have to leave them anything at all, although most parents choose to do so. It may be more beneficial for you to plan a way for your children to participate in continuing your legacy. For example, you could create a charitable foundation in which your children could take leadership positions.
Putting too much emphasis on tax mitigation
Many people make taxes the primary focus of their estate planning. Taxes are certainly an important consideration but should not be central. Currently, with the federal exemption being over $11 million, estate taxes are an issue for only a handful of people. That could change in the near future due to pending legislation, but even if the exemption reduces to $5 million, you can have a much more productive discussion if it centers not on taxes but on assets.
While estate planning can be more difficult with significant assets, it also offers more opportunities to do good in the world with what you have earned in life.