Wills

5 Ways DIY Estate Plans Can Fail & Leave Your Family at Risk

January 25, 2024

I have practiced law for over 15 years, first working at a medium-sized firm in San Francisco handling civil litigation, and then moving into estate planning, small business and contract law since 2010. I value people, the planet, and prosperity that does not adversely affect the former.

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Do a Google search for “digital wills” or “online estate planning,” and you’ll find dozens of different websites offering low-cost, do-it-yourself (DIY) and sometimes even free estate planning documents, such as wills, trusts, powers of attorney, and healthcare directives.

From LegalZoom and Rocket Lawyer to TrustandWill.com and FreeWill.com, these DIY legal documents may seem like a cheap and easy way to finally cross estate planning off your to-do list—and do so without having to pay a lawyer big bucks to assist you. After all, you’ve been able to prepare and file your taxes online for years, is estate planning really that much different? And aren’t lawyers using the very same forms you find on these DIY document websites?

An Inconvenient Truth

This kind of thinking is exactly what DIY and online estate planning services would like you to believe, but it’s far from true. In fact, relying on DIY or online estate planning documents can be one of the costliest mistakes you can make for your loved ones.

Keep in mind, just because you created “legal” estate planning documents that doesn’t mean they will actually work when you—or most importantly, the people you love—need them. Without a thorough understanding of your family dynamics, the nature of your assets, and how the legal process works upon your death or incapacity, you are likely to make serious mistakes when creating a DIY or online estate plan.

Even worse, these mistakes won’t be discovered until it’s too late—and the loved ones you were trying to protect will be the very ones forced to clean up your mess or get stuck in a costly and traumatic court process that can drag out for months or even years.

In the end, relying on DIY or online estate planning documents can actually be worse than having no estate plan at all—and here’s why:

A False Sense of Security

Creating your estate plan using online document services can give you a false sense of security—you think you’ve got estate planning covered, when you most likely do not. DIY plans may even lead you to believe that you no longer need to worry about estate planning, causing you to put it off creating a proper plan off until it’s too late.

In this way, relying on DIY estate planning documents is one of the most dangerous choices you can make. In the end, such generic forms could end up costing your family even more money and heartache than if you’d never gotten around to doing any planning at all.

At least with no plan at all, estate planning would likely remain at the front of your mind, where it rightfully belongs until it’s been handled by you and trusted counsel to guide you.

Planning to Fail

The primary purpose of estate planning is to keep your family out of court and out of conflict in the event of your death or incapacity. Yet, as cheap online document services become more and more popular, millions of people are learning—or will soon learn—that taking the DIY route can not only fail to achieve this purpose, it can make things even more complex and costly for the people you love.

Most people assume that estate planning is all about filling out the right legal documents. But in reality, the true value of estate planning is not about the documents themselves—it’s the planning aspect that’s most important, not the documents. Documents are the byproducts of the plan and the outcome of counseling and decisions that require thought, consideration, and a true understanding of all the options and their potential consequences.

Without proper planning and consideration, the documents themselves—wills, trusts, health care directives, and powers of attorney—aren’t worth the paper they’re printed on. And by proper planning, we mean having a trusted advisor who can help you anticipate all of the potential problem areas and conflicts—as well as potential opportunities—that could impact your plan, and then help you adapt your plan accordingly and create documents to ensure the maximum benefit (and minimum heartache) for your loved ones.

When done right, the value of this kind of estate planning is truly priceless because it results in the right plan for your family at the right budget for you, and it leaves your loved ones with not just a set of documents, but with a trusted advisor who will be there for them when you cannot be. This is exactly what the Law Office of Ruby Steinbrecher provides every client we serve through our Life & Legacy Planning Process.

One Size Does Not Fit All

“In preparing for battle, I have always found that plans are useless, but PLANNING is indispensable.” –Dwight D. Eisenhower, Former U.S. President and Commander of Allied Forces during WWII

A typical set of documents that you get from an online DIY estate planning service (and even many estate plans created by lawyers) will usually include three to five basic legal documents: a will, a financial power of attorney, a healthcare directive, possibly a trust, and a legal guardian nomination, if you have minor children. By now, it’s fairly common knowledge that these are the legal documents needed in case you become incapacitated or when you die.

But what isn’t common knowledge and what isn’t adequately covered by any online legal document service or even by many lawyers is what needs to go into those documents, and what’s needed to ensure those documents actually work for the people you love when they need them.

You see, standard documents simply cannot address the real-life complexities of your family dynamics, your assets, and the ever-changing circumstances of your life. Contrary to what the DIY services would like you to believe, estate planning is not a one-size-fits-all, once-and-done kind of deal. Even if you think your particular assets and family situation are simple, that turns out to almost never be the case, and you are likely to face one of the following issues that can leave your loved ones at risk.

5 Ways Your DIY Plan Can Fail

1 | Thinking a Will is Enough

One of the ironic things about estate planning is that the one legal document everyone thinks they need most is the one legal document that actually accomplishes the least. Yes, you know you need a will, but a will alone doesn’t do much.

A will can ensure the people you choose are the ones who handle your affairs and who ensure your assets go where you want them to go in the event of your death. But a will does not keep your family out of court. In fact, relying on a will alone ensures your family and friends have to go to court when you die. Plus, a will doesn’t even come into play if you are incapacitated. And if you have minor children, relying on a will alone to designate their legal guardians could leave your kids vulnerable to being taken out of your home and into the care of strangers.

2 | Improper Execution

You could have the best documents in the world, but if you fail to sign them, or sign them improperly, they will fail. It may seem silly, but it’s true. We’ve seen family after family who brought us an estate plan after the death or incapacity of a loved one that we were not able to support them and act upon because the documents were either not signed, or were signed improperly.

To be considered legally valid, certain estate planning documents like wills must be executed (i.e. signed, witnessed, and/or notarized) following very strict legal procedures. For example, many states require that you and every witness to your will must sign it in the presence of one another. If your DIY will doesn’t mention that condition (or you don’t read the fine print) and you fail to follow this procedure, the document can end up worthless.

If you have created or started a DIY estate plan and wish to have it reviewed, contact us to see how you can get a Family Wealth Planning Session at no cost to you. During this 2-hour session, we will review what would happen to your family and your assets with your current plan and discuss the best next steps for protecting your family.

3 | Choosing The Wrong Executors or Trustees

State laws are also very specific about who can serve in certain roles like executor, trustee, or financial power of attorney. In some states, for instance, the executor of your will must either be a family member or an in-law, and if not, the person must live in your state. If your chosen executor doesn’t meet those requirements, he or she cannot serve.

Furthermore, some states require the person you name as your executor to get a bond, which is like an insurance policy, before he or she can serve. Such bonds can be difficult to get for someone who has a less-than-stellar credit score. If your executor cannot get a bond, it would be up to the court to appoint your executor, which could end up being someone you would never want managing your assets or a third-party professional, who could drain your estate with costly fees.

4 | Lost and Unclaimed Assets

Unless your family knows exactly what assets you own and how to locate and access those assets, that property is as good as gone when you die—and your online will won’t be of any use to your family. In fact, there’s currently more than $50 billion worth of unclaimed property sitting in the different state Departments of Unclaimed Property across the U.S. because a family member died and their loved ones lost track of their assets.

To ensure that none of your assets end up in our state’s Department of Unclaimed Property, and your family will know exactly what you have and how to find everything if something happens to you, it’s essential that you keep a regularly updated inventory of all your assets. The Law Office of Ruby Steinbrecher will not only help you create a comprehensive asset inventory but also make sure it stays regularly updated throughout your lifetime.

5 | Unforeseen Conflict Between Family Members

Family dynamics are—to put it lightly—quite complex. This is particularly true for blended families, where spouses have children from previous relationships. A DIY service cannot help you consider all the potential areas where conflict might arise among your family members and help you plan ahead of time to avoid such disputes. Even the best set of documents will be unable to anticipate and navigate these complex emotional matters—but we can.

Every day we see families ripped apart due to poor estate planning. Yet, we also see families brought closer together as a result of handling these matters the right way. When done right, the estate planning process is actually a huge opportunity to build new connections within your family, and we are specifically trained to help you with that.

In fact, preventing family conflict with proactive estate planning is our special sauce and one of the primary reasons to work with us, as your Personal Family Lawyer, rather than relying on DIY planning documents.

The Kind of Planning Your Family Deserves

When it comes to estate planning, the documents you use are only as good as the understanding your lawyer has about your family dynamics, the nature of your assets, and how the law will apply to your situation upon your death or incapacity. And in most cases, you will need far more than just a few fill-in-the blank documents to properly address all of those complexities.

If you truly want things to be as simple as possible for the people you love when something happens to you, you want a trusted counsel who can prepare an estate plan that will achieve your desired objectives with a minimum amount of stress and conflict for the loved ones you are leaving behind, not just someone who has the best documents. This is where we come in.

If, as a result of this process, we determine that you really do have a very simple situation, and you want to create your own planning documents yourself online, we will support you to do that. However, if as a result of the process, you decide you would like us to draft a plan for you, we’ll support you to find the optimal level of planning for a price that’s right for you.

As part of our planning process, we will inventory all of your assets and ensure they are titled in a way that will keep your family out of court and out of conflict no matter what happens to you. Moreover, we take the time to get to know your family members and include them in the planning process, so everyone affected by your plan is well-aware of what your latest planning strategies are and why you made the choices you did, along with knowing exactly what they need to do if something happens to you. And if you are the parent of minor children, we will put safeguards in place to ensure that your kids are never placed into the care of strangers, even temporarily.

Finally, and perhaps most importantly, our Life & Legacy Planning process will ensure that it’s not just your money and tangible assets that get preserved and passed on, but also your family’s intangible legacy, which includes your family’s most treasured values, insights, stories, and mementos. We capture and record your family’s legacy using a unique process known as a Family Wealth Legacy Interview, which is included with every estate plan we create.

Life & Legacy Planning

Ultimately, we’ve discovered that estate planning is about far more than planning for your death and passing on your “estate” to your loved ones—it’s about planning for a life you love and a legacy worth leaving by the choices you make today—and this is why we call our services Life & Legacy Planning.

As your Personal Family Lawyer, we are specifically trained to educate, empower, and support you to make the right decisions for the people you love, and get to know what really matters most to you. Furthermore, because your plan is designed to protect and provide for your loved ones in the event of your death or incapacity, we aren’t just here to serve you—we’re here to serve your entire family.

In the end, as your Personal Family Lawyer, our Life & Legacy Planning services go far beyond simply creating documents and then never seeing you again. We will develop a relationship with you and your family that lasts not only for your lifetime but for the lifetime of your children and their children if that’s your wish.

While the DIY approach might be a good idea if you’re looking to build a new deck for your backyard, when it comes to estate planning, it’s one of the worst choices you can make. Are you really willing to put your family’s well-being and wealth at risk just to save a few bucks? If you want to truly do right by those you love, contact us, to get your Life & Legacy Plan started today.

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