'Failure to act' is a major estate planning mistake

Date: May 10, 2011

The biggest estate planning mistake people can make is failing to plan at all, according to one wealth management expert and writer.

Jean Blacklock, author of The 50 Biggest Estate Planning Mistakes and How to Avoid Them, asserted that when a person dies without a will in place, their assets are distributed according to a legal formula, without taking into account the individual circumstances of each case, the Star Phoenix reported.

She commented that for many families, the fallout from the lack of a will can be "very emotional".

Ms Backlock said: "It creates a very difficult situation."

She asserted that there are a number of ways for people to "sabotage" estate planning - whether they are acting deliberately or not.

Procrastination, failure to plan for family squabbles, passivity, overestimating loved ones and underestimating the potential problems that can arise are all common mistakes people make.

"They don't deal with family dysfunction - the alcoholic son, the conflict that will occur over the family cottage," she explained, adding that many people have an "I'm sure it will be fine" attitude to estate planning.

One of the best things an individual can do for their families, she explained, is to find a good estate planner that you enjoy a "very good rapport" with.

She commented that this person should be someone you feel comfortable sharing sensitive information with and can openly discuss issues including fees, processes and how long everything will take.

Planning a will, she said, is "not an easy task".

Ms Blacklock added: "If you're doing it right, you're facing the fact that we're all mortal. But it's actually an act of love for the family members who remain."

Seeking assistance from a lawyer is also worthwhile if you are planning a significant change, such as a move to an aged care facility.

Expert Jenny Christie of Priority One Training Group told the Daily Examiner that an adviser can help you make a plan to keep your family home for inheritance purposes, including updating your will.

In Australia, assets are distributed under the Wills, Probate and Administration Act , which sets out the rules of inheritance. These can sometimes be complicated - if you are a dependent or family member of a person who has died without leaving a will, you should seek the advice of a qualified wills and estates lawyer.

This lawyer can also ensure you receive any inheritance you are entitled to.