Making decisions about basic will terms seems easy enough. That is, until you realize that life is full of change. If you neglected to consider the effects of future changes in your life, your DIY will and estate plan could go terribly wrong. A DIY online will could be a costly mistake.
Part 1 in a series of common estate planning provisions
and the "what-ifs" to consider.
Given the state of the economy today, it’s no wonder that consumers are turning to DIY legal form websites for their estate planning. However, it’s important to know when to draw the line between doing a DIY project and letting the professionals handle the task. Taking complicated matters, such as estate planning, into your own hands can sometimes backfire.
Before you take the plunge on your DIY estate plan, know the risks.
I have seen a multitude of these DIY estate plans go very wrong, causing my clients and their families to spend much more money correcting the debacle than they would have if I’d been involved from the start. I have also reviewed and corrected countless others that were fraught with problems that would have resulted in a serious, unintended consequences. Before you take the plunge on your online estate plan, you should be aware of the risks.
Estate planning is complicated, not just in the drafting of the forms, but in their selection and implementation. The forms used in estate plans should not be standard, generic forms like a HIPAA Release at your doctor's office. Each document used in your estate plan should be selected and customized to fit your situation. For instance, not all people need a trust to accomplish their goals. And a power of attorney document is not something that should always be a part of everyone’s estate plan.
In addition, when drafting a will or trust, a single phrase or sentence can have consequences that you never anticipated or intended. Trying to create an estate plan on your own might lead to mistakes like these because you do not have the experience to recognize them.
The "What-Ifs" of Life
Lawyers are experts at identifying potential risks and unforeseen consequences. We are trained to anticipate potential change and eventualities. We expect and plan for the unexpected - the "what-ifs." Raising the “what-if” questions is what we do. This is one of the many reasons working with an estate planning lawyer is so valuable.
That said, here are 5 common will provisions and some of those “what-ifs” you should consider, or should have considered, while completing your estate plan online.
1. Naming 2 people as Co-Executors of your estate.
Having two executors can be a solution if you want to divide up the work between two people. Or, if you want to simplify the probate process for your family.
However, have you ever seen two people agree with each other 100% of the time? This is especially true if they are siblings. What happens if they don’t agree on a course of action? Do they both have to sign off on things? Can one act unilaterally? Who is the tie-breaker? Your will should clearly address these issues.
2. Naming 1 of your 3 children as Executor because she is the “best with money.”
On the one hand, this seems to be a wise decision. On the other hand, there is no better way to sow seeds of discontent and mistrust than to have one child with all the information and power while the other two are on the outside looking in. Depending upon their circumstances, would it ultimately be better to name all three instead? Do you know the pros and cons of doing so?
3. Creating a trust for for your minor children so they will inherit equally when they reach Age 25.
A fine idea. But what if you die after your eldest child graduates from college but before your youngest child begins?
In that case, will they really inherit equal shares or will your eldest receive their “equal” share plus a fully paid college education? The phrase “equal shares” may be used in your will, but depending on your children’s ages when you die, they may end up with quite a lopsided deal.
4. Creating a Revocable Living Trust in an effort to avoid probate.
Understandable. But do you know how to fund it? If so, did you fund it with the right assets? Did you transfer those assets correctly? This can be a complicated process. Additionally, did you know that there are alternative ways to avoid probate that don’t involve a trust?
5. You’ve named your best friends Claire and Tom (a married couple) as guardians of your minor children.
They live nearby and have kids of their own who attend the same school district as your children. You feel comfortable that this will be the best situation for your children. However, have you seen the divorce rates in the U.S. these days? If their marriage does take a turn for the worse, who remains as the guardian of your kids? What if they don’t agree?
As our parents used to say, "you get what you pay for." Call an estate planning attorney who will take the time to ask you these "what-if" questions. You'll save time and money in the long run.
When my client and I sit down together to create an estate plan, I don't expect the client to be an expert in estate planning. That's my role. I ask these "what-if" questions and I listen. It’s then my job to create a plan that does what my client wants it do, while avoiding those unintended consequences. Estate planning does not have to be a complex process for you. Give me a call and we will get it done right, the first time.
If you've already completed an estate plan online, feel free to send it over to me for a no- obligation, complimentary DIY will review.