Five Common Mistakes with “DIY” Estate Plans

In light of the current pandemic, many Americans are becoming aware of the importance of creating or updating their estate planning documents. With the extension of some states’ stay in place orders, it may be tempting to create your own documents on your own. Whether you are considering writing your own will or using an online “do it yourself” (DIY) document creator, there are many reasons why this is one project you shouldn’t undertake without the help of a professional.

What is a DIY estate plan? 

A DIY estate plan is something that you “do yourself” without the advice of an estate planning attorney. Someone who DIYs their own legal documents could be:

1. Handwriting a “will” themselves; 
2. Downloading a “fill in the blank” document that they got on the internet; or
3. Using an online document generator that asks pre-set questions. 

Here are five common mistakes associated with DIY estate plans.

1. DIY estate plans may not conform to the applicable law

Forms that can be found on the internet may claim to conform to your state’s law, but it’s not always the case. The laws that apply to estate planning are determined by each state—and there can be wide variations. In addition, if you own property in another state or country, the laws in those jurisdictions may differ significantly, and your DIY estate plan may not adequately account for them. 

2. A DIY estate plan could contain inaccurate, incomplete, or contradictory information

If you attempt to create a will using an online questionnaire, there is the possibility that you may select the wrong option or leave out important information that could prevent your will from accomplishing your goals. Potential problems could be made even worse when do-it-yourself services allow users to insert additional information not addressed by the service’s preset questionnaire: the information added by a DIYer could contradict other parts of the automated will.

3. Your DIY estate plan may not account for changing life circumstances

If you create a will where you leave everything to your two children, what happens if one of those children dies before you? Will that child’s share go entirely to his or her sibling—or will it go to the child’s offspring? What if one of your children accumulates a lot of debt? Is it okay with you if the money or property the indebted child inherits is vulnerable to claims of the child’s creditors? What if your will states your daughter will receive the family home as her only inheritance, but it is sold shortly before you die? Will she inherit nothing? 

An experienced estate planning attorney will help you think through the potential changes and contingencies that could have an impact on your estate plan– and help you design a plan that prevents unintended results that could frustrate your estate planning goals. A computer program will not.

4. Mistakes in executing the plan can be easily made

Under the law, there are certain requirements that must be met for wills to be legally valid. For example, a will in New York requires the signatures of two witnesses. Some states require not only that the will be signed by the will-maker and the witnesses, but also that they all sign the will in each other’s presence. In other states, witnesses are not required to be in the same room when the will-maker signs the will, and they can even sign it later if the will-maker tells them his or her signature is valid. Bottom line: there isn’t much point in doing a will if it’s going to be thrown out of court when you pass away because it wasn’t signed and executed properly. 

5. Assets may be left out of your estate plan

Many people do not realize that a trust is frequently a better estate planning tool than a will because it avoids expensive, time-consuming, and public court proceedings that would otherwise be necessary to transfer your money and property to your heirs after you pass away. Even if you have a DIY trust, if you do not “fund it” (i.e., transfer title of your money and property into the name of the trust) it will be ineffective and your loved ones will still have to endure the probate process to finish what you started. 

Further, if you do initially transfer the title of all your assets to the trust, it is likely you will acquire additional property or financial accounts over the years that must go through probate if the titles are not transferred to the trust. Regular meetings with an estate planning attorney can help ensure that your plan accomplishes your goals and that your grieving family members are not left with major headaches after you die.

We Can Help

A DIY estate plan can lead to a false sense of security because it may not achieve what you think it does. If your DIY will is not valid, your property and money will go to heirs specified by state law—who may not be the people you would have chosen. An unfunded trust will be ineffective. Banks may not accept a generic power of attorney you found on the internet. Laws affecting your estate plan may change. An experienced estate planning attorney is aware of any trends in the law that could dramatically affect your estate plan and has the expertise needed to help you design and create a comprehensive plan. 

Schedule your Peace of Mind Planning Session today so we can help provide you and your family with peace of mind knowing you have an estate plan that accomplishes your goals and will avoid unnecessary attorneys’ fees, headaches, and conflict when you are gone. Mention this article and we will waive the $450 session fee. 

 

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The Law Office of Laura E. Cowan, PLLC

Attorney Laura Cowan’s estate planning practice focuses on helping individuals and families make important decisions today to avoid unnecessary pain and conflict tomorrow.

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