Three Estate Planning Moves That Deserve a Second Look
Many estate planning problems don't come from inaction. They come from doing something — with the best of intentions — without checking how that decision fits with everything else.
Here are three common estate planning moves that are well-intentioned at the time but can quietly create bigger problems down the road.
Putting the kids on the deed
The intention: "Let's add our daughter to the deed so she doesn't have to deal with probate when we're gone."
The consequence: When you inherit property at death, you generally receive a stepped-up basis — the home's value resets to its current market value, so the family owes no capital gains tax on decades of appreciation.1 But when a parent adds a child to the deed during their lifetime, the IRS treats it as a gift. The child receives the parent's original cost basis instead.1
For example, say a parent adds their child to a home originally purchased for $40,000 that's now worth $450,000. The child could inherit the $40,000 basis — and face capital gains taxes on $410,000.2 The IRS may also treat the transfer as a taxable gift.3 And joint ownership can expose the home to the child's creditors.4
A different approach: Passing property through a will or trust generally preserves the step-up in basis — which means the family may avoid the capital gains tax entirely.
The Trust That Doesn't Actually Work
The intention: "We set up a trust. We're covered."
The consequence: A trust only controls assets that have been retitled into it — a process called "trust funding." If you create a trust but never transfer your home, bank accounts, or investment accounts into the trust's name, those assets may still pass through probate.7
The trust exists on paper. But it doesn't own anything. So when it's time for the trust to do its job, it can't.
A different approach: After creating a trust, work with your attorney to confirm that your major assets are actually titled in the trust's name. The document alone isn't enough — the funding is what makes it work.
The Beneficiary Form You Forgot About
The intention: "I named my beneficiaries when I opened the account. That's handled."
The consequence: Beneficiary designations are a commonly overlooked part of an estate plan. Many Americans have never revisited theirs — even after getting married, divorced, or having children. And here's the part many people don't realize: beneficiary forms on retirement accounts and life insurance don't follow your will. In most cases, they supersede it.5
That means an ex-spouse, a deceased relative, or simply "the estate" could receive your assets — regardless of what your will says. With $16.2 trillion sitting in IRAs alone, the stakes of a forgotten form are enormous.6
A different approach: Review beneficiary designations after every major life event. Confirm they align with your current will and overall estate plan — not just with what made sense when you first filled them out.
The Thread That Connects All Three
None of these are careless mistakes. They're what happens when people make estate planning decisions one at a time, without someone looking at how they all fit together.
The deed interacts with the tax plan. The beneficiary forms interact with the will. The trust interacts with the property titles. Estate planning is a system — and the only way to know if yours is working is to look at the whole picture.
Now, if you read these scenarios, and thought about your own parents, here are a few questions that can start a productive conversation without overstepping:
"Do you know who's listed as a beneficiary on your retirement accounts? Has it been a while since they were last updated?"
"I know you added me to the deed. Have you talked to anyone about whether that still makes sense?"
"When's the last time someone looked at your will, your trust, and your beneficiary forms all together?"
These aren't questions grounded in criticism. They come from care and intention.
Estate planning works when someone is looking at all of it together — the deed, the beneficiary forms, the trust, the will. If no one has done that for your family recently, that's a conversation worth having.