Wills and estate pitfalls that can erode wealth and family legacies

Avoiding these six common pitfalls can help protect your wealth and preserve your family legacy.

Pitfall 1: Assuming an estate can simply be divided “equally”

A common mistake is assuming that each asset will deliver the same practical value to each beneficiary.

Equal dollar amounts may look fair, but the tax profile, liquidity and ongoing obligations attached to each asset can differ materially.

Property, investments and business interests may each create different after-tax outcomes, so estate plans should be reviewed through a practical as well as legal lens.

Pitfall 2: Failing to consider asset protection

Families often focus on protecting wealth while it is being accumulated, but less attention is given to how that wealth may be protected once inherited.

Estate plans should consider future risks, including relationship breakdowns, creditor exposure, insolvency and litigation, particularly where beneficiaries are financially vulnerable, control family entities or operate businesses with commercial risk.

Appropriate structuring can help ensure inherited wealth is managed with resilience, flexibility and long-term family objectives in mind.

Pitfall 3: Neglecting business succession planning

For business owners, estate planning and succession planning need to work hand-in-hand.

Plans should clarify how ownership, leadership responsibilities, decision-making rights and funding arrangements will operate if an owner exits, becomes incapacitated or passes away.

Business succession planning should also consider shareholder agreements, insurance funding, enduring powers of attorney and who will ultimately control key business entities following death or incapacity.

Without a clear pathway, the business may face uncertainty, disputes, cash flow pressure or a loss of value at a critical time.

Pitfall 4: Overlooking the importance of structure

Wealth is often held across multiple vehicles, including trusts, companies, superannuation, direct investments and property. Importantly, assets held by discretionary trusts and companies generally do not form part of a person’s estate. Instead, what may pass on death is the ability to control those entities. Accordingly, the ownership of assets is only part of the picture, the succession of trustees, appointors, directors and shareholders should also be appropriately documented to ensure control passes as intended.

If governing documents, control mechanisms or succession provisions are out of date, the intended estate planning outcome may not be achieved.

Periodic reviews can help align structures with current family, commercial and tax objectives.

Pitfall 5: Ignoring testamentary trust opportunities

Passing assets directly to beneficiaries may be simple, but it is not always the most effective approach.

Depending on the circumstances, testamentary trusts may offer additional flexibility, asset protection and tax planning benefits for future generations.

It’s important to work with your accountant or advisor to discuss options to determine the best approach for your personal circumstances.

Pitfall 6: Failing to plan for family dynamics

Strong technical planning can still be undermined if family expectations are unclear.

Conflict may arise where beneficiaries do not understand the reasons behind particular decisions or where different family members have different expectations.

Consideration should also be given to documenting the reasons behind significant decisions, particularly where beneficiaries may receive unequal outcomes. While not legally binding, letters of wishes can assist executors and help explain intentions to future generations.

Clear records, open communication where appropriate and a documented strategy can help reduce the risk of future disputes.

Estate planning is about more than a will

Estate planning works best when legal, tax, financial and commercial issues are considered as part of one coordinated strategy.

It should answer critical questions such as:

• Are my assets adequately protected?
• Will my wealth pass efficiently to the next generation?
• Is my business succession plan fit for purpose?
• Do my structures still align with my objectives?
• Have tax consequences been fully considered?
• Will beneficiaries receive outcomes that are equitable and practical?

Forvis Mazars works with clients to help protect, preserve and transition wealth in a way that reflects their family, business and long-term financial objectives.

Our experts can assist with:

• Estate and succession planning reviews
• Family wealth structuring
• Asset protection strategies
• Business succession planning
• Trust and corporate structure reviews
• Tax-effective wealth transfer strategies
• Intergenerational planning
• Coordination with legal advisers on wills and testamentary trust arrangements

Whether you are preparing for retirement, transitioning a family business or reviewing how significant assets are held, our advisers can help you develop a practical strategy that supports continuity, protection and long-term value. Contact your usual Forvis Mazars advisor or one of our specialists below:

Published:  31/07/2026

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