The Practical Planner – Episode Summary
Episode Title: Top Estate Planning Mistakes
Hosts: Thomas Kopelman & Dave Hodden
Date: November 18, 2025
Podcast by: Wealth.com
Episode Overview
In this episode, Thomas Kopelman and guest Dave Hodden dive deep into the most common—and costly—estate planning mistakes they encounter as advisors. Rather than rehashing basic facts, their focus is on sharing personal stories and actionable insights that advisors can use to better serve clients across all phases of estate planning. The discussion is animated by real-world examples, practical analogies, and their signature blend of expertise and candor.
Key Discussion Points & Insights
1. The Biggest Mistake: Failing to Have an Estate Plan
- [01:11]
- Many people, including professionals, procrastinate or assume they don’t need an estate plan because “everything will just go to my spouse or kids.”
- Dave:
“Everyone has an estate plan, but do you know who set up that estate plan for you? It’ll be your state legislature.” (02:25)
- Without a plan, assets default to state laws, often resulting in extra costs, delays, and even outcomes that defy the decedent’s wishes.
2. Procrastinating or Believing Time is on Your Side
- [03:23] Thomas:
- “There’s not always a next year. These things are really important to do … they take less time than you think. You just need to go get them done.” (04:13)
- Illustrated by a story about a young friend who passed away with no estate plan, resulting in unnecessary hardship.
3. DIY Estate Planning Hazards
- [05:03] Dave:
- Warns against informal tactics like gifting homes or assets directly to children to “avoid probate,” without understanding unintended consequences.
- Personal anecdote: Client’s parent put a house in their child’s name to bypass probate, only for bankruptcy to later endanger both siblings’ inheritance.
- Dave:
“It’s very, very dangerous to put someone else’s name on your property unless you’re doing it very carefully.” (07:24)
4. Missing Step-Up in Basis & Failing to Plan for Taxes
- [07:27] Thomas:
- “If you gifted [the house] while alive to the son, he inherits the basis of the parents and he doesn’t get step up in cost basis when they pass away. … That takes away a lot of the value.” (08:17)
- Many fail to capitalize on tax planning opportunities, including capital gains exclusions, gifting strategies, and 529 Superfunding.
5. Neglecting to Name Successors or Contingencies
- [08:41] Dave:
- Far too often, estate plans name only one Power of Attorney, trustee, or beneficiary, neglecting contingencies.
- Dave:
“You need to think, ‘What if this happens? But then what if this happens?’” (10:02)
- Example: A trust left in limbo after both the primary and sole backup trustees died, causing family strife.
6. Not “Funding” the Trust or Failing to Align Beneficiaries
- [10:42] Thomas & Dave:
- People often pay for trusts but don't move assets into them (i.e., "funding").
- Outdated or missing beneficiary designations regularly sabotage plans, sometimes gifting assets to ex-spouses or estranged relatives.
- Dave:
“Not funding your estate plan is like just having a nice beautiful treasure chest… but there’s nothing inside.” (11:52)
7. Forgetting About Advanced Healthcare Directives for Young Adults
- [13:50] Thomas:
- Parents rarely consider healthcare directives for 18+ college-bound children, leaving them unable to make medical decisions in an emergency.
- Dave:
“Everyone of every age needs estate planning documents. Once you reach the age of majority, the question is just how sophisticated does it need to be?” (14:31)
8. Neglecting to Update the Estate Plan After Major Life Changes
- [15:55] Thomas:
- Life events—marriage, divorce, moving states, births, deaths, asset changes—require updates to documents.
- Outdated plans may lack digital asset provisions, crypto accounts, or reflect new relationships.
- Dave:
“How is it possible that your estate plan doesn’t need to change at all?” (16:54)
9. Inadequate Trust Structure for Young Beneficiaries
- [18:07] Thomas:
- Stories abound of young heirs squandering inheritances due to poorly structured trusts with no distribution controls.
- Thomas:
“No 18 to 22 year old should be given $900,000 to manage and pick investments on…” (19:26)
10. Skipping Comprehensive Power of Attorney Documents
- [21:59] Dave:
- Generic, “bare bones” powers of attorney are often rejected by banks and custodians for lacking specific authorities (e.g., ability to change IRA beneficiaries).
- Kitchen sink, detailed POAs are preferable to ensure agent authority and avoid court intervention.
Notable Quotes & Memorable Moments
-
On Why Procrastination is Dangerous:
“Everyone has an estate plan, but do you know who set up that estate plan for you? It’ll be your state legislature.” – Dave (02:25)
-
On Failing to Fund a Trust:
“Not funding your estate plan is like just having a nice beautiful treasure chest … but there’s nothing inside.” – Dave (11:52)
-
On Young Heirs Inheriting Too Early:
“No 18 to 22 year old should be given $900,000 to manage and pick investments on … they haven’t gone through the pain to realize, ‘I have no edge here.’” – Thomas (19:26)
-
On Digital Asset Planning:
“How is it possible that your estate plan doesn’t need to change at all? … The biggest thing that’s changed … are digital asset planning, provisions for your Facebook account, your crypto assets …” – Dave (16:54)
Timestamps for Key Segments
- 00:32 – 01:36:
Opening context, why estate planning matters, and widespread misunderstanding. - 03:23 – 04:35:
Procrastination and its real-world consequences. - 05:03 – 07:27:
Dangers of “DIY” estate planning and real client horror stories. - 07:27 – 08:36:
Tax mistakes—step-up in basis, capital gains, gifting strategies. - 08:41 – 10:42:
The pitfalls of limited or missing successor/contingent designations. - 10:42 – 12:59:
Trust funding and the importance of asset titling and beneficiary alignment. - 13:50 – 15:55:
Advanced healthcare directives for young adults and estate planning simplicity by age. - 15:55 – 18:07:
Updating plans after life changes, including new digital asset considerations. - 18:07 – 21:17:
The dangers of letting young adults inherit large sums with no guardrails. - 21:59 – 23:10:
Risks of generic powers of attorney and the case for comprehensive documents.
Takeaways for Advisors
- The biggest mistake is not acting at all; even professionals are guilty.
- DIY solutions frequently cause more harm than good—seek professional guidance.
- Trusts, beneficiary designations, and POAs need regular review and should be as detailed and comprehensive as possible.
- Advisors are instrumental in shepherding clients through funding trusts, aligning designations, planning for taxes, and ensuring estate plans keep pace with life.