Estate Planning

Pitfalls of DIY Estate Planning

There is no doubt that everyone loves a bargain when organizing their estate and giving instructions on the distribution of their worldly goods after death. Yes, you can write your wishes on a piece of paper or you can fill out some quick online forms and have either witnessed as a last will and testament to save a few dollars. However, if there is any type of confusion or mistake, it is highly possible that survivors of the deceased will end up in court spending thousands of dollars to contest the will.  Oftentimes, the money spent to correct or decipher a will far out paces regular attorney fees due the first time around in setting up a proper plan.

As an established estate attorney, I am consistently answering questions about the viability of DIY wills and, on a few occasions, have been asked to help modify a DIY will already in affect that is confusing and doesn’t meet the needs of the client. We all know that some bargains actually save you money on a great product that makes your life better while others end up being costly mistakes. Whether buying a will from a stationary store or using an online service, DIY estate planning tends to fall into the latter category.

Estate planning, when done right, is a customized process that provides a family protection plan specific to your goals and family circumstances. I can’t tell you how many times I am informed by prospective clients that they have an easy estate. Complications are typically revealed within the first 15 minutes of a consultation when I start asking about family dynamics, unique financial circumstances, and assets.

Without knowing what to look for, a typical person is not equipped to plan for complicated legal scenarios that can cause an amateur estate plan to fall short and cause even bigger, costly problems that pit family members against each other.

Here are a few scenarios that DIY planning does not help you account for:

  1. Choosing the proper person to serve as your trustee/executor/agent
    Many people choose their kids, usually from the oldest to the youngest. Or, some people just make all their children co-actors in those roles. One of the questions I ask during a consultation is how the designated person manages their finances. If a person has poor financial management skills with regard to their own affairs, they are not the right candidate for serving as your trustee or agent for durable power of attorney. We live in a transient society where family members are spread out all over the country or even the world. Appointing two or more individuals to work together to administer your estate could end up being a logistical nightmare. Imagine a scenario where a bank requires the signature of all the trustees to open a trust account and one co-trustee lives in Florida and the other lives in New Zealand. Just because you can appoint a person doesn’t mean you should, and an estate planner will help you figure out who the best person for the job should be.
  2. Heirs with special needs
    Many individuals with special needs are recipients of needs-based aid such as Social Security Insurance or Medicaid. Inheriting money, in almost any form will cause this person to be disqualified for these types of aid. Sometimes what constitutes a special need might not be apparent. A child suffering from a chronic illness who is unable to work is someone for whom special accommodations should be made with regard to his/her inheritance. An experienced planner will help you identify those situations that warrant these protective types of planning.

  3. Ensuring that assets are treated properly
    Some assets such as guns need special planning to ensure that they are distributed lawfully. Typically, when people think of their assets they focus on their home, bank accounts or investments. They are not thinking about their gun collection. This is a potentially problematic belonging that should be included in the list of assets to ensure that it is passed on legally. Digital assets (social media accounts, emails, and electronic banking etc.) should be identified and a plan should be put in place to properly manage them if a person becomes incapacitated and/or die. Experienced planners know the rules regarding different types of assets and have the necessary tools to make sure that they are handled properly.

The British saying, “don’t be penny-wise and pound foolish” is cliché, but aptly applies in this situation. Saving money on your estate plan now doesn’t make sense if it is faulty and will take extensive and costly changes to fix. Having an attorney on your side that understands the legal nuances will help you mitigate taxes, prevent expensive litigation and provide access to an inheritance faster.

The Law Office of Jan A. Meyer was founded in 2011 in Dana Point, CA. It was established to provide clients with an alternative impersonal large law firms or self-guided online forms mills. Families need a committed, competent and compassionate estate planning attorney to assist them with protecting their assets and helping them plan their future. At the Law Office of Jan A. Meyer, families are guided through a series of decisions, at the end of which they walk away with a plan that ensures that their family and their assets are protected the way the client wants even after the client is no longer able to do it.

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