Over the years, we have worked with many clients and families as they built, reviewed, and updated their estate plans as part of their broader financial plan. During those conversations, we have seen the same misconceptions come up time and again.
Some create unnecessary concern. Others can leave important gaps between what someone intends and what may actually happen.
Estate planning is not only about taxes or transferring wealth. It is about protecting the people you care about, preparing for the unexpected, and making sure your wishes are clearly understood and properly carried out.
Here are 11 common estate planning myths we often encounter in the planning process.
1. “Estate planning is only for the wealthy.”
If you own a home, have retirement accounts, carry life insurance, or have children, you have an estate.
A good plan also addresses who would care for minor children, manage your finances, make healthcare decisions, and carry out your end-of-life wishes.
2. “My will leaves everything to my spouse, so I’m all set.”
Many assets pass outside of your will.
Retirement accounts, life insurance, annuities, joint accounts, and transfer-on-death accounts are generally controlled by ownership and beneficiary designations. An outdated beneficiary can override what your will says.
3. “If I give someone more than $19,000, I owe gift tax.”
In 2026, you can generally give $19,000 per recipient without using any of your lifetime exemption. Married couples may generally give $38,000 per recipient.
Giving more may require a gift tax return, but it does not necessarily mean tax is owed.
4. “I’m too young to need an estate plan.”
Once someone turns 18, parents may no longer have automatic authority to make medical or financial decisions for them.
Young adults should consider a healthcare directive, HIPAA authorization, and financial power of attorney.
5. “I already have a will, so my plan is complete.”
A will is only one part of an estate plan.
A complete plan may also include powers of attorney, healthcare directives, guardianship instructions, beneficiary reviews, trusts, digital asset instructions, and tax planning.
6. “Trusts are only for the ultra-wealthy.”
Trusts can help families avoid probate, maintain privacy, plan for incapacity, and control how assets pass to beneficiaries.
Whether one is appropriate depends more on your assets, family situation, and state laws than on a specific net-worth threshold.
7. “My family will know what to do.”
During a crisis, even close families can disagree or misunderstand your intentions.
A clear and legally enforceable plan reduces uncertainty and helps prevent unnecessary conflict.
8. “I can only contribute $19,000 per year to a 529 plan.”
529 plans allow a special five-year election.
In 2026, an individual may potentially contribute up to $95,000 at once, or $190,000 for a married couple, and treat the contribution as though it were made over five years.
9. “My revocable trust will reduce estate taxes.”
A revocable trust is generally designed to help with probate, privacy, and incapacity planning—not estate tax reduction.
More advanced tax planning may involve irrevocable trusts, but these strategies require careful legal and tax coordination.
10. “I paid for my child’s tuition, so I cannot give anything else.”
Tuition paid directly to an educational institution and qualifying medical expenses paid directly to a provider may fall outside the normal annual gift limit.
That means these payments may be made in addition to annual exclusion gifts.
11. “My trust is signed, so the work is finished.”
A trust must also be properly funded.
That may involve retitling real estate, taxable investment accounts, bank accounts, and certain business interests, while also coordinating beneficiary designations.
A trust that is never funded may not accomplish what it was intended to do.
Estate Planning Requires Coordination
One of the most important lessons we have learned from working with families is that a strong estate plan requires more than simply signing legal documents.
Your will, trusts, beneficiary designations, account ownership, insurance coverage, investment plan, and tax strategy all need to work together.
At Tidewater Wealth Management, we partner with clients and their estate planning attorneys to help identify potential gaps, review beneficiary designations and account ownership, coordinate trust funding, and align the financial plan with the legal documents.
Our role is not to replace the attorney. It is to help make sure the financial side of the plan is organized, implemented, and working the way you intended.
If it has been several years since your estate plan was reviewed—or your family, finances, health, or residence has changed—please reach out to our team. We would be happy to help review the financial side of your plan and coordinate with your attorney where appropriate.
This material is for general educational purposes and is not intended as legal or tax advice. Please consult a qualified estate planning attorney and tax professional before implementing any strategy.