How-tos are everywhere these days! Step-by-step guides to home improvement projects are just a YouTube search away. My son will even search YouTube for a tutorial on how to win the level of Lego Star Wars that he’s stuck on, and voila! Success.
Estate planning, however, is one of those things that you should never attempt yourself or via DIY kits. This week’s article explains why planning for your family is leaps and bounds different from putting in hardwood floors.
Why DIY Estate Planning Is a Bad Idea for the People You Love
America is a nation of do-it-yourselfers, but building a deck and creating a legally valid estate plan are two entirely different things — and a less-than-perfect deck won’t devastate your family’s financial future or the relationships among the people you care about most.
The prevalence of online legal services has led many people to believe that they can create legal documents cheaply and those documents will be just as effective as if they had visited an estate planning attorney.
This is why that is wrong:
No legal advice. These sites are little more than document mills that churn out the same generic forms over and over. They are not attorneys and cannot advise or warn you if you make a mistake. Plus, who will be there for your family when something happens to you, if you’ve used an online document drafting service?
Think your family doesn’t need an advisor to support them when you are gone? Think again.
Consider this: Erica’s father was killed in a motorcycle accident. Dad didn’t leave much behind, but he did leave an estate plan prepared by a trusted family attorney. Had the family attorney not been there for Erica and her brother, they would have taken what dad did leave and drowned their sorrows in a European backpacking trip. Thanks to this family attorney, though, Erica and her brother now have a healthy trust fund set up for them for life with the proceeds of a successful wrongful death case.
Leaving it to your family to know what to do after you’re gone is a big mistake for the people you love.
One size doesn’t fit all. Your family is different from everyone else’s family. Just like every state has different inheritance laws, every family has a different situation. An online form will not help you protect a special needs child or relative, or protect a child’s inheritance from creditors or a nasty divorce. An online form cannot tell you how to protect assets from taxes or help you achieve your goals.
And an online form cannot keep your family out of conflict during a time of grief. Even if you don’t have a lot of assets you are leaving behind, whatever you do have will be subject to distribution between the people you care most about. Some of the biggest disagreements we’ve seen after death aren’t about loads of money but about the little things, and those little things aren’t going to be dealt with well by form documents.
Save now, pay later. You may think you are saving money by using an online service to create your will or trust, but it is impossible to make a fair comparison since the services provided are entirely different.
An estate planning attorney creates an entire plan tailored to your individual needs in legal documents that will stand up in court, and advises you on ways to cut taxes and save for retirement and long-term care. No online service does that.
In addition, your trusted advisor is going to be there for your family when you cannot be. The people you love will need someone to turn to after you are gone. Do you want them to be stuck with figuring out who that should be during their time of grief? Or do you want to leave behind the gift of having taken care of things well during your lifetime and a trusted advisor to hold their hand when you no longer can?
More information at mylawaz.com.
Amie Mendoza is principal of The Law Offices of Amie Mendoza, PLLC