The Do-it-Yourself Will or Trust

There has been a recent proliferation of Do-it-Yourself (DIY) estate planning products. Whether it’s online document assistants, assorted box software packages, or self-help books, the DIY forms that these sources provide may seem attractive to individuals given they cost a fraction of what estate planning attorneys typically charge, but is it worth it in the end?

Although a do-it-yourself Will or Trust may be cheap and easy, the likelihood that a DIY Will or Trust will effectively accomplish exactly what you intend is slim. Below are four reasons why the risks of DIY estate planning outweigh the benefits.Do-it-yourself Will or Trust

(1) There are too many things that can go wrong.
DIY products only address uncomplicated estates. They cannot account for any unique or family circumstance. For example, they are not set up to handle even the most common complexities such as children from a prior marriage, children with special needs, property that has appreciated in value resulting in capital gains, or estates that are large enough to be subject to estate taxes.

Further, mistakes are common in do-it-yourself Wills and Trusts. Many things can go wrong such as improper or missing wording in the document, not following instructions correctly, or even a simple typo. For example, consider these scenarios:

George bought a boxed software package for his Will. The instructions on the DIY Will indicated [Insert Name Here], which he mistakenly left blank. George ended up leaving $150,000 to “Insert Name Here” as opposed to leaving it to his beloved nephew.

AND

Nancy wanted to leave $100,000 to her only sister. A simple typo on the online form, $100.000 (note the period versus the comma) led to a legal issue upon her death.

Another frequent error in DIY estate planning relates to improper execution of the documents – meaning the way the documents are signed and witnessed. For example, in Massachusetts if you witness a Will and you are named as a beneficiary in that Will, you are not entitled to receive any inheritance. And the instructions for a DIY Will probably will fail to include that.

It’s clear how easily DIY documents can be invalid, ineffective, or contain legal language that has consequences never intended. You most likely would never discover the mistake during your lifetime, but at your passing, your family and loved ones will know, and could end up paying the price and cleaning up the mess after you’re gone.

(2) You’re paying for a document assistant, not a lawyer.
DIY sources provide forms but not legal advice. If you get stuck, they are not there to guide you. If you make a mistake, no one is there to warn you.
The online services that provide a Will or Trust are not lawyers or law firms. They are prohibited from giving legal advice. They are simply “document assistants” – meaning service providers who type your information into generic, fill-in-the-blank form documents.

Estate planning is much more than producing documents or “buying paper.” Without a legal education and years of experience, it is impossible to accurately determine what the ideal estate planning solution is for you and your family based on your personal circumstances. Although it is customary to describe an estate plan as a list of documents, the documents themselves are simply tools to put into effect a plan that should be specifically tailored to your specific goals and objectives. DIY sources fail to take advantage of sophisticated estate planning strategies because they cannot account for an individual’s unique circumstances.

(3) Fixing DIY estate planning mistakes is expensive.
Depending on the complexity of your estate, as well as your specific planning goals and objectives, estate planning documents can be obtained from a lawyer for $800 to $3,000 or more. But these costs pale in comparison to the expenses that your loved ones may incur if there are serious errors in your DIY estate planning. Many more thousands of dollars may have to be spent by your loved ones to undo what was done wrong.

(4) Estate planning laws change.
Estate planning laws are constantly changing. Changes occurs due to new case law or legislation, particularly regarding estate taxes. Experienced estate planning attorneys stay abreast of these changes, while DIY websites, software, and other sources may not do as good a job at keeping current and up-to-date.

Is a Do-it-Yourself Will Better than Nothing?

Proponents of DIY products will typically tell you that a do-it-yourself Will is better than having no Will at all. In most cases this is true. The consequences of dying without a Will in place (i.e., dying intestate) are that the Commonwealth of Massachusetts will make all important decisions for you, such as how your assets are distributed and who will care for your minor children.

What the DIY folks fail to mention, and most people fail to realize, is that the rules of intestacy still apply if you make a mistake with a do-it-yourself Will. Consider this scenario:

A mother of three wanted to disinherit her one son after a large family dispute. She turned to an online service to get a Will, followed all the instructions and listed her assets. She forgot to list some penny stocks that she had bought over 20 years ago. When the mother passed years later, those stocks, which were once so insignificant, had grown in value to over $1 million. Given that the DIY Will did not include a residuary clause – meaning how assets are distributed after creditors, estate taxes, and gifts or specific amount of assets are paid to beneficiaries – the stocks passed according to the laws of intestacy. The so-called “disinherited” son ended up receiving $200,000 which he quickly squandered in six months due to a drug and gambling addiction.

The Bottom Line

Although you will save in legal fees using a cookie-cutter, fill-in-the-blank Will or Trust, there are also risks involved. Issues such as defective forms, violations of Massachusetts law, or improper witnessing likely will not be evident to you when the documents are signed and executed. It will likely only be after death or incapacity occurs when the problems are discovered, and at that point, it may be very costly, or even worse, too late to revise the documents.

The bottom line: you may save a few dollars now, but end up creating an expensive and frustrating mess for your family in the end.

When choosing an estate planning attorney like the Socius Law Firm over a do-it-yourself Will or Trust, you are retaining a counselor who will craft a plan that your family must live with after you are gone; you are choosing the trusted advisor whom your loved ones will depend upon at their most difficult times; and you are creating a relationship with an attorney that should last for life.

By Todd Rosenfield

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