Don’t Let These Estate Planning Mistakes Undermine Your Legacy

At some point, you’re sure you met with an attorney, signed a pile of documents, and checked all of the estate planning boxes. Maybe you even celebrated getting it done with a dinner out! Hard to remember, but you seem to recall there may have been fax machines involved, so it was probably a while ago.

If your estate plan is gathering dust in a drawer or buried in a long-forgotten file on your desktop, it might not be doing the work you think it is.

Estate planning isn’t one-and-done. Life moves, families shift, tax laws change, and your goals evolve. At best, an outdated plan can create confusion and inefficiency. At worst, it may derail your intentions for your legacy entirely.  

We’ve seen this story play out more times than we can count. Even the most thoughtfully constructed plan can lose its power if it’s left on autopilot. 

In this article, we’re discussing the most common estate planning mistakes and how to avoid them.

Mistake #1: The Set-It and Forget-It Approach

The problem: You created the plan, filed it away, and haven’t looked at it since.

This might be the single most common estate planning misstep we see. You spend time and money working with an attorney, feel great once the documents are signed, and then you simply forget about them and expect them to be there when you need them. 

Over the years, all sorts of life events happen. Your daughter gets married, your son has children, you buy a vacation home, your mother passes away, and you roll over your 401(k) a few times. Each of these life events can ripple through your estate plan, creating gaps or conflicts you never intended.

The solution: Review your estate plan every 2–3 years, and after major life events.

Think of it like changing your oil. You wouldn’t expect your car to run perfectly for decades without any maintenance. The same goes for your estate plan.

Here are some signals that it’s time for a tune-up:

• Birth of a new child or grandchild
• Marriage or divorce (yours or your children’s)
• Death of a family member or key decision-maker
• Significant changes in your assets or liabilities
• Purchase of major assets like real estate or business interests
• Shifts in tax law or estate regulations (state or federal)
  

Even during “quiet” years, regular reviews will make sure your estate plan is keeping pace with your life.

Mistake #2: Out-of-Date Beneficiary Designations 

The problem: You assume your will or trust dictates who inherits everything you own.

It’s a common assumption, but not how it works. Retirement accounts, life insurance policies, and other accounts with named beneficiaries completely bypass your will. That means the name on file is what counts, no matter what your estate documents say.

You could painstakingly update your trust to distribute your assets fairly among your children, only to have a substantial 401(k) still list an ex-spouse as the beneficiary. In a case like that, the kids are unfortunately going to miss out on that particular asset. 

The solution: Regularly review and update all beneficiary designations.

Make a checklist of every account with a beneficiary, and set a recurring calendar reminder to check them annually. Here are the most common accounts to review:

• 401(k) and 403(b) accounts
• Traditional and Roth IRAs
• Life insurance policies
• Annuities
• Some brokerage and transfer-on-death (TOD) accounts
  

It only takes a few minutes to spare your loved ones a mess of legal headaches later on.

Mistake #3: Missed Opportunities for Tax Exemptions

The problem: You want to pass everything to your heirs tax-free, but fail to preserve estate tax exemptions through trusts.

For married couples, the estate tax exemption is not automatically preserved. For example, Rhode Island offers an exemption of $1.8 million per person (as of 2025), or $3.6 million total. But unless your estate plan is structured correctly, one spouse’s exemption can disappear when the first spouse dies. 

That means your family could owe taxes on wealth you could’ve passed on tax-free.

The solution: Use properly structured trusts to preserve both spouses’ exemptions.

This usually means creating and funding a trust with up to one spouse’s exemption amount. This keeps those assets outside the surviving spouse’s taxable estate, while still allowing them to access funds if needed.

Here’s how that might look in real life:

• A married couple owns:
  • A $1 million home (jointly held)
  • $2 million in non-retirement investment accounts (jointly held)
  • $1 million in each spouse’s retirement account
    

When the first spouse dies, everything shifts to the surviving spouse by default, thanks to joint ownership and beneficiary designations. Now the survivor holds $4 million individually.

However, they can still only use their own $1.8 million exemption. The first spouse’s exemption went unused. As a result, their estate could owe taxes on $2.2 million they could have shielded.

If you’ve accumulated significant assets and want to make sure your legacy stays intact, trusts should be part of the conversation.

Mistake #4: The Digital Asset Dilemma 

The problem: Your estate plan doesn’t mention your digital assets.

Estate plans used to be made up of paper files and safe deposit boxes. But in 2025, your digital life is a real part of your net worth and a powerful piece of your legacy. This could include: 

• Email accounts with important communications
• Cryptocurrency wallets
• Cloud storage accounts
• PayPal or Venmo balances
• Online subscriptions, business logins, or monetized social media accounts
  

If no one knows these exist—or can’t access them—those assets could be lost forever.

The fix: Create a digital estate plan.

This doesn’t have to be complicated. Just be sure to take inventory of your digital accounts and passwords, along with any instructions for what you want done with them. 

Real-World Example

We recently worked with a couple who wanted to leave a meaningful legacy through charitable giving. They’d updated their trust documents to reflect gifts to several nonprofit organizations and felt confident their wishes would be honored.

But when we ran long-term projections, we realized they were likely to spend down most of their non-retirement assets during their lifetime. If that happened, their charitable gifts—tied to those assets—would vanish.

We worked alongside their estate planning attorney to rethink the strategy. Instead of relying on the trust alone, we made the charities beneficiaries of their retirement accounts.

Their attorney also updated the trust so that once both clients have passed, the trustee would know what the overarching charitable goal was. 

If this was fulfilled through the retirement accounts, then no additional action would need to be taken. If there was a shortfall, then the trustee could shore up that bequest with remaining non-retirement assets.

It’s a great reminder that good intentions often need a coordinated strategy to help them become reality. 

Your Legacy is Worth a Little Maintenance

Your legacy isn’t just about what you leave behind. It’s about the clarity, confidence, and care you provide for the people and causes you love. 

You wouldn’t go decades without changing the oil in your car or checking the air in your tires. Your estate plan deserves the same kind of attention – not because something’s broken, but because life keeps moving. 

Families grow. Goals shift. Tax laws change. And what worked five years ago might not hold up today.

At SK Wealth, we help clients keep their estate plans running smoothly with a coordinated strategy that reflects their real lives. Through our Integrated Financial Advantage™ process, we make sure your financial, legal, and tax plans are talking to each other and working for you.