How to Avoid Common Mistakes in Estate Planning

Whether you're just starting out or updating a decades-old will, estate planning is essential—not just for distributing your assets, but also for preserving peace of mind, minimizing tax burdens, and protecting loved ones.

Unfortunately, many individuals make preventable mistakes that can result in costly legal battles, unintended consequences, or prolonged probate proceedings. At Richard L. Vanderslice, P.C., we help clients in Philadelphia, Pennsylvania, and the surrounding areas avoid those mistakes and create comprehensive and effective estate plans.

Let’s break down the most common estate planning mistakes we see and how you can avoid them.

Failing to Create an Estate Plan at All

The most basic and, sadly, most frequent mistake is simply not having an estate plan.

Some believe estate planning is only for the wealthy. Others feel too young to think about wills or trusts. But the truth is: if you have dependents, own a home, have retirement accounts, or wish to dictate your own healthcare decisions, you need a plan.

In Pennsylvania, if you die without a will (known as dying intestate), your assets will be distributed according to state law, not necessarily in the way you would have chosen. For example, contrary to common belief, your spouse doesn’t always inherit everything.

At a minimum, every adult should have:

• A Last Will and Testament

• A Durable Power of Attorney

• A Healthcare Power of Attorney and Living Will

• Updated beneficiary designations on life insurance and retirement accounts

Waiting too long to put a plan in place can result in your family scrambling to make decisions without your input, often during moments of grief or crisis. A proactive estate plan isn’t just a legal safeguard—it’s an act of care for the people you leave behind.

DIY Wills and Online Templates

While the internet has made legal information more accessible, estate planning isn’t a one-size-fits-all process. We often review "homemade" or online wills that are vague, invalid under Pennsylvania law, or omit crucial provisions.

For instance, Pennsylvania doesn’t recognize oral wills and only recognizes handwritten wills if they’re properly witnessed. A will that isn’t properly executed—signed, dated, and witnessed—can be thrown out by probate court, leaving your estate subject to intestacy rules.

Be sure to consult a Pennsylvania estate planning attorney. Even a simple consultation can help confirm that your documents meet all legal requirements and truly reflect your intentions.

Failing to Update the Plan After Major Life Changes

Life is dynamic. Marriage, divorce, the birth of a child, a move to another state, or the death of a loved one are all events that necessitate updating your estate plan.

We’ve seen situations where an ex-spouse remains the named beneficiary on a life insurance policy, or where guardianship for minor children is left to someone who has since passed away. These oversights can create real legal complications.

Review your estate plan every three to five years, or immediately after any major life event. Updates should include not only your will but also beneficiary designations, powers of attorney, and trusts.

Neglecting to Fund a Trust

Revocable living trusts are often recommended for their ability to bypass probate and maintain privacy. However, a trust is useless if it isn’t funded, meaning your assets aren’t properly transferred into the trust.

We’ve had clients who set up a trust but never changed the ownership of their bank accounts or real estate, leaving everything to pass through probate anyway.

Once your trust is created, work with your attorney to transfer ownership of your assets to the trust. This can include:

• Real estate

• Investment accounts

• Business interests

• Vehicles (in some cases)

Failing to fund your trust can undermine your entire estate plan. Think of the trust as a container—if nothing is placed inside it, it can’t serve its intended purpose.

Overlooking Digital Assets

In today’s digital age, estate plans should include provisions for digital assets—from online banking to social media and email accounts.

Many people don’t realize that their executor or loved ones may be legally barred from accessing their online accounts unless explicitly authorized in estate planning documents.

Make a comprehensive inventory of your digital assets and logins, and include instructions for accessing and managing them. Pennsylvania has adopted the Revised Uniform Fiduciary Access to Digital Assets Act (RUFADAA), which allows digital access with proper legal documentation.

Failing to Name Contingent Beneficiaries

Naming a primary beneficiary on an account or life insurance policy isn’t enough. If that individual predeceases you, the asset could become part of your probate estate or pass to someone you never intended.

Always name contingent beneficiaries for your:

• Retirement accounts (e.g., IRAs, 401(k)s)

• Life insurance

• Payable-on-death (POD) accounts

• Transfer-on-death (TOD) securities

Additionally, remember that beneficiary designations override your will. If your will says one thing, but your beneficiary designation says another, the latter controls.

Ignoring Tax Implications

Estate taxes are less of a concern for most Pennsylvanians due to the high federal exemption ($13.61 million per individual in 2024). However, Pennsylvania imposes its own inheritance tax, which applies to most property transferred at death.

Rates range from:

• 0% for spouses

• 4.5% for lineal heirs (children, grandchildren)

• 12% for siblings

• 15% for other heirs

Additionally, poor planning around retirement accounts can trigger income taxes for your beneficiaries.

Work with a tax-savvy estate attorney or financial advisor to understand how your plan impacts your heirs. Tools like gifting strategies, trusts, and charitable bequests can help reduce your tax footprint.

Poor Choice of Executor or Trustee

Choosing the wrong executor or trustee can lead to serious delays, conflicts, or mismanagement of your estate.

We’ve seen families torn apart when an executor was ill-equipped, out-of-state, or had a conflict of interest. In Pennsylvania, executors have fiduciary duties and are legally responsible for acting in the estate’s best interest.

Pick someone:

• Trustworthy

• Financially responsible

• Willing and able to serve

• Preferably located in Pennsylvania (though not required)

Also, consider naming a corporate trustee or professional executor for complicated estates or to avoid family conflict.

Failing to Plan for Incapacity

Estate planning isn’t just about what happens after you die—it’s also about what happens if you can’t make decisions for yourself.

Without a durable power of attorney and a healthcare directive, your family may have to go to court to be appointed your guardian. This is expensive, time-consuming, and emotionally draining.

Create these essential documents:

• Durable power of attorney (for financial decisions)

• Healthcare power of attorney

• Living will (to express end-of-life care wishes)

These allow your designated agents to act on your behalf in the event of injury, illness, or cognitive decline.

Assuming Everything Will "Just Work Out"

Too often, people assume their family will know what to do or agree on everything. But grief can bring out conflict, confusion, and old resentments.

Ambiguous instructions, unequal distributions, or lack of communication can spark disputes—even litigation.

We recommend taking the following actions:

• Communicate your intentions clearly with loved ones

• Write a letter of instruction to guide your executor

• Avoid surprises—if you're making an unequal distribution, explain why

Transparency and planning can go a long way toward avoiding unnecessary conflict.

Not Planning for Long-Term Care Costs

One of the greatest threats to your estate isn’t taxes—it’s long-term care.

Nursing homes in Pennsylvania can cost upwards of $10,000/month. Without proper planning, your estate could be depleted quickly, leaving little for your heirs.

Some steps you can take to plan ahead include:

• Explore long-term care insurance

• Consider Medicaid planning (5-year lookback rule applies)

• Set up irrevocable trusts to protect assets (must be done years in advance)

An elder law attorney can help you work through complicated issues before a crisis occurs.

Over-Reliance on Joint Ownership

Some people add a child or relative as a joint owner on bank accounts or real estate to “avoid probate.” While this might work in some cases, it can also:

• Expose the asset to the joint owner’s creditors

• Cause tax or Medicaid eligibility issues

• Lead to family disputes after your death

Use Payable-on-Death (POD) or Transfer-on-Death (TOD) designations instead of joint ownership when possible. Better yet, consult your attorney about trust-based solutions for asset management and distribution.

Not Coordinating Your Entire Estate Plan

Estate plans often involve multiple components: a will, one or more trusts, beneficiary designations, joint accounts, powers of attorney, etc. When these aren’t aligned, inconsistencies can lead to confusion and litigation.

For example, your will may say your house goes to your son, but if it’s titled jointly with your daughter, she may legally inherit it instead.

Work with your estate planning attorney to coordinate:

• Your will and trusts

• Asset titles and ownership

• Beneficiary designations

• Business succession plans (if applicable)

Your estate plan should operate as a cohesive system.

Contact Our Estate Planning Attorney

At Richard L. Vanderslice, P.C., we guide our clients through every step of the estate planning journey, from drafting wills and setting up trusts to addressing family dynamics and planning for incapacity. Located in Philadelphia, Pennsylvania, we’re proud to serve Philadelphia County, Montgomery County, and Delaware County. An effective plan today means peace of mind for tomorrow; take action now by contacting us to schedule a consultation.