Downloading a will form on the internet is simple and may seem like an easy way out for those who dread working with an attorney to make an estate plan.
Unfortunately, DIY estate plans too often create a much bigger mess than no plan at all. I can tell you that a botched estate plan ends up costing your loved ones a great deal of money, time, and stress.
These are the major pitfalls of DIY estate planning:
Your estate plan may not be valid in a court of law. Estate plans have different signature requirements in each state. Some require multiple witnesses; some require a notary. Without meeting the exact specifications of your state’s laws, your handwritten will won’t be considered valid. It may be tossed out as if you’d never written it at all.
A DIY plan isn’t tailored to the laws of your state. State laws vary greatly and have a lot of nuances. A generic will might be enough to get you through probate, but you can never be sure how much extra money it will cost. If you own property in another state, your estate goes through both probate courts, which may be expensive.
There are many considerations when it comes to making a plan that fits your state’s laws exactly, and only an attorney in your state can help you understand these differences thoroughly and make the most of your plan.
Probate may take longer and be more expensive. A generic estate plan that doesn’t consider or plan for all your assets and values might be harder for a probate court to sort through. There will be more difficult decisions to make, and it takes more time.
Time is costly in probate court, not only because attorneys and other people involved with your plan may need to be paid from your estate. During probate, your beneficiaries may only receive a monthly stipend from your estate, which can put anyone financially dependent on you in a difficult financial situation.
Family harmony is at stake. Some families are perfectly harmonious–but many are not. And many harmonious families change when it’s time to distribute money, which is sad but true. In my years as an estate-planning attorney, I’ve seen too many good relationships go sour over some family heirlooms.
A generic plan cannot accommodate difficult family relationships like a comprehensive plan with an attorney. Plans that can be downloaded from the internet are just not sophisticated enough to manage families with any detail, so they leave out important tools that can keep a family together through a tragedy.
Less customization for unique individuals. A DIY estate plan assumes “one-size-fits-all,” but you know that isn’t true for the people you love. They are all unique individuals and deserve the right kind of attention. Maybe one of your children isn’t as financially mature and you want to provide them with more training wheels, or one has a difficult marriage and you fear that their piece of the estate could end up with their ex. There are many ways to protect your hard-earned money from these scenarios, but they require the finesse of a smart estate planning attorney.
Your will may be contested. In addition to maintaining family harmony, your estate plan should be iron-clad against contests. A contest happens when people try to invalidate the will. This can happen much more easily with a DIY estate plan, which does not account for certain family dynamics or issues that might lead to a will contest.
A lawsuit such as a will contest takes time and money from your other beneficiaries and from the estate in general. It can be costly and emotionally stressful to the people you love.
DIY plans don’t include valuable healthcare information. Emergency healthcare documents are equally important as your asset distributions when it comes to making an estate plan. A living will, healthcare power of attorney, and durable power of attorney are all essential documents to a comprehensive plan.
While these documents can be found in stock form, they don’t account for the laws of your individual state, and they often don’t include the multiple scenarios presented by an estate planning attorney. These documents hold a lot of power, and they can save lives in the event of an emergency. It’s not worth the risk to use a generic document that can cause problems or delays.
Tax planning is best left to the professionals. A holistic approach to your financial life means working with both a financial planner and an estate planning attorney. If your estate is large enough to warrant tax planning, it’s in your best interest to work with a professional. Trust me, an attorney’s fees to create a solid estate plan are far less than the estate taxes for your beneficiaries.
Funding and retitling assets may create problems. If done improperly, a half-baked estate plan is a much bigger mess than no plan at all. When non-lawyers attempt to create complicated trusts that require retitling assets, they struggle to make sure every asset is handled appropriately.
Eventually, the estate needs more attorneys and attorney time to fix–much to the chagrin of your beneficiaries, who are left with the paperwork.
Attorneys have insight and experience. There’s a reason that a professional plan costs more in the beginning: an attorney dedicates the time and energy to your individual family, your challenges, and your values. Estate planning attorneys have seen many difficult scenarios that offer insight into family dynamics and protect you and your loved ones.
This insight may be invaluable. A professional plan requires a small investment, but it can save thousands of dollars in the future.
Don’t risk your most valuable assets or the time and energy of your favorite people. Put your effort into making a professional, comprehensive estate plan–one that will protect your assets and the people you love. For more information on the Side by Side Planner, click here.