With all of the media about “digital wills” and “online estate planning” it could be tempting to think that you can do your estate planning yourself. Maybe you can. If you do, you need to know the potential pitfalls. Online estate planning could be a big trap for the unwary and might actually leave your family worse off than if you had done nothing at all.
First and foremost, before you do any of your own online estate planning, it is critical to understand your family dynamics, the nature of your assets, and what the state would say would happen to your assets when something happens to you. You see, whether or not you do estate planning, the state does have a plan for your assets when you die. You need to know what that plan is, so that you know whether or not you want to change it.
A good start on getting educated is this one hour training class, with financial and legal expert Ali Katz, which clarifies what you can and should do yourself, for free, online. The easy-to-watch training gives you access to a free online tool that you can use to create the one thing that would be most important for your family: a “treasure map” listing everything you own, where it is, and how your loved ones can access it. This tool is free to use, and creating your own personal resource map will be a true gift for the people you love.
But Don’t I Need a Will and Can’t I Just Do It Online?
Here is the funny thing about estate planning: the one legal document that everyone thinks they need most, actually does the least.
Every adult (yes, everyone over the age of 18) does need SOME estate planning. A will is always a good idea because it says who gets, and who is in charge of distributing, what you have. However, if the default law would have given your assets to the same people you would choose and authority to the person you would name anyway, then an online will would probably do nothing valuable for you at all. They often do not contain the correct language to give your personal representative authority to act independently, nor do they tend to meet the requirements of being “self-proved,” which means that the witnesses would likely have to appear in court to verify the will. Sometimes the problem just lies in the signing instructions.
A will does not keep your family out of court, and if drafted improperly, it could require the executor that you have named to get a bond, which is like an insurance policy. These can be hard to get for anyone who has less than a stellar credit score. If your named executor cannot get a bond, it would then mean that the court would appoint a stranger to serve as administrator, and that can be costly for your estate. This is just one of the examples of how having a will prepared online can create more expense for the people that you love. Unfortunately, none of the online will preparation solutions that I have reviewed mention this risk.
So, yes, you can do your own will online, but at what potential cost for the people that you love?
The Problem with Online Wills
DIY online estate plans (much like estate plans created by lawyers) usually include four to seven basic documents: a will, a financial power of attorney, a medical power of attorney, a medical directive (or living will), possibly a HIPAA release, sometimes a trust, and a legal guardian nomination if you have minor children.
Honestly, completing these documents without counsel is simply not sufficient to guarantee your estate will be executed as simply, affordably, and effectively as you would wish.
For instance—are you sure there is not some missing consideration that could lead to turmoil as your family tries to figure out what to do? Did you know that most family fights don’t even happen over money, but over lack of clarity? Have you taken into account all of your extended family, including stepchildren and ex-spouses? What will be done with all the personal, sentimental items you want to pass on to your children?
What about making sure your family knows what you have and where it is? An online will will not tell them that. There is somewhere between $49 billion and $80 billion being held in state departments of unclaimed property across the United States because someone died and their family lost track of their assets.
So how can you be sure you have got everything covered, legally?
With online wills and DIY estate planning docs, you won’t even know what questions to ask to uncover the potential risks to the people you love. Those people deserve to receive what you have created in your life, without a big mess.
Think about this: do you know anyone who has lost family relationships because, after a loved one died, the family ended up in an irreconcilable fight? Maybe this has even happened in your own family. The consequences—both, financial and emotional—can be devastating.
It is all unnecessary.
Even if there are attorneys on staff at these online companies, they don’t get to know you and your family dynamics enough to spot the real issues that could arise. They are, instead, focused on a one-size-fits-all solution and easy answers to complex issues.
The Kind of Help Your Family Deserves
Even lawyers who specialize in estate planning sometimes base their work on template documents, and have limited skill in getting to the heart of your family matters. Well-intentioned attorneys working with old, traditional systems, that were born around the same time as word processing, focus too much on having the “best” documents. The problem is that the documents are only as good as the understanding a lawyer has about your family dynamics, the nature of your assets, how the law will apply to your situation, and how the documents can be written as simply as possible to achieve your wishes. You need much more than just a set of four or five filled-out template documents to address all of those complexities. The way we see it is, if you want things to be as simple as possible for the people you love, you want counsel to prepare a plan that achieves your desired objectives.
This is where we come in. We have specific training in how to educate you, empower you, and support you to make the right decisions for the people you love. We get to know what really matters to you.
We do this through our Family Wealth Planning Session process. If, as a result of the process, we see that you really do have a very simple situation, and you want to create your documents yourself online, we support you to do that. If, as a result of the Family Wealth Planning Session you decide you do need us to draft a plan for you, we support you to choose the right planning fee for you.
We only take 8 individuals or couples through the Family Wealth Planning Session process each month, so we can ensure that the clients we work with get the attention they need to create a plan that actually works for the people that they love.
We inventory your assets, ensuring they are all owned in a way that will keep your family out of court (if you wish) and conflict (which you surely do); and ensure everyone named in your plan has what they need and understands your choices. Most importantly, we ensure you understand your plan, and we ensure you pass along more than just your money.
Do it yourself estate planning is risky. While it may be better than nothing, it may also be worse. It will not be until after you are gone that your loved ones find out where a DIY plan stands. If you want to do the right thing by the people you love, you have three options for how to get started:
- Book a Family Wealth Planning Session with me. It’s normally $750, but if you call and tell us you read this article and commit to doing just a bit of homework ahead of time, I’ll waive that Planning Session fee.
- If you aren’t quite ready to call yet, and want to learn a little more first, go to this link and watch the one-hour training there. Create your own Map and, then, if as a result of the training you decide you do need counsel from a lawyer, book a Family Wealth Planning Session with me after that. If you send me your completed map, I’ll not only waive the Family Wealth Planning Session fee, but I’ll also give you a $250 credit towards any planning you need. Be sure to mention you attended the training, and that you want to claim your $1000 of legal services.
- If you want to talk for 15 minutes before your Family Wealth Planning Session, call my office and book that time here: 817-479-0076.
This article is a service of The Mundheim Firm, PLLC, Personal Family Lawyer®. We don’t just draft documents; we ensure you make informed and empowered decisions about life and death, for yourself and the people you love. That’s why we offer a Family Wealth Planning Session,™ during which you will get more financially organized than you’ve ever been before, and make all the best choices for the people you love. You can begin by calling our office today to schedule a Family Wealth Planning Session and mention this article to find out how to get this $750 session at no charge.