There are basic elements to estate planning that are generally included in any comprehensive plan. But like any field, there are emerging trends, fads and misinformation that can alter a plan for better or worse. It is important to get reliable, cutting edge advice to avoid mistakes while still taking advantage of powerful new tools.
If you are considering establishing a plan for the future, or making changes to your existing plan, you need to be able to separate fact from fiction.
The latest thing
Tax law is often the driving force behind estate planning trends. The tax treatment of an investment or estate device can dramatically impact the value of a plan. Legal tax avoidance strategies tend to rise in popularity until something changes. The possibilities include:
- Changes to the underlying law
- New tools coming into play that duplicate or improve on old strategies
- Changes in the interpretation of a strategy by the IRS or SEC
- Growing realization that a strategy did not provide the touted benefits
The sooner you can identify a useful tool from a temporary fad, the less time and money you will waste on your plan. Getting in early on “the next big thing” is incredibly tempting. There is a reason that so many people get burned by investments and plans that seemingly spring up overnight. The fear of missing out is strong.
To avoid falling into a fad, you need to have a thorough understanding of your goals in estate planning. You also need the advice of professionals who have handled estate planning for many years. They can help you understand the latest trends and how they fit in with your overall strategy.