Here’s why do-it-yourself estate planning is such a bad idea
This article looks at three of the biggest risks of do-it-yourself wills, including the risk for legal disputes.
As USA Today reports, 64 percent of Americans don’t have a will or estate planning documents and many see no urgent need to have an estate plan in place. Of course, one option for those who don’t have a will is to create their own with a do-it-yourself will template available online. While it is tempting to think that any will is better than no will (and, indeed, usually this is the case), there are risks with going it alone when it comes to estate planning. Below is a look at why DIY estate planning is a bad idea and what to do instead.
People don’t know what they don’t know
DIY wills are designed as a one-size-fits-all solution, meaning they aren’t typically going to address unique or unusual estate planning needs. An attorney will know the details that a software program will likely overlook. While these details can seem small at first, they could prove costly later on. For example, as MarketWatch notes, most DIY wills won’t alert users to the possible need for a contingent executor or beneficiary. Others may overlook the fact that a portion of the estate may need to be set aside to pay for taxes.
Risk for legal disputes
When people make their own wills, there is a much higher chance that they will also make a mistake than if they had gotten help from an attorney. Those mistakes are how disputes between heirs arise, especially if there is more than one will or a previous will has been changed without first consulting an attorney. Furthermore, an attorney can help build an estate plan that will lower one’s tax obligations. A lighter tax burden can reduce the likelihood of a dispute breaking out since heirs can otherwise be taken aback if they find a larger portion of the estate than they anticipated ends up going to taxes.
Estate planning is about more than wills
Many people make the mistake of assuming that a will is the only legal document they need for a solid estate plan. But estate planning is about so much more than just wills and a DIY will kit may not make it clear which documents one needs (and doesn’t need). For example, there are trusts, living wills, and various powers of attorney that may be required. Not having these documents prepared could lead to significant problems later on.
Talking to an attorney
The easiest and most straightforward way to avoid to pitfalls of DIY estate planning is to talk to an estate planning attorney today. While a DIY will may sound like a bargain early on, in the long term it can lead to costly mistakes that can cause legal disputes and a reduced estate for one’s heirs.