Some people first talk to a lawyer about their estate plan after they use some kind of DIY tool to create their own estate planning devices. It isn’t surprising that many of these people learn that the tools they have created are completely wrong for their needs. In fact, a lot of people who use do-it-yourself, or DIY, estate planning tools end up having to spend a lot of money to correct the mistakes they make. Here are several reasons why DIY estate planning can be a bad idea.
DIY Mistake 1. You can create a will and avoid probate.
The idea of avoiding is probate something many people have as their goal thoughts as they go about creating estate plans. Probate is rule-intensive, complicated, lengthy, and potentially costly, and avoiding it is almost always a good idea.
However, people who create a last will and testament as a way to try to avoid probate are going about it entirely incorrectly. A will does not help you avoid probate at all. In fact, because a court will have to determine if the will meets the relevant legal standards, making a last will and testament guarantees that probate will take place.
DIY Mistake 2. All you need is a revocable living trust.
Revocable living trust are excellent estate planning tools. Not only do they give you some incapacity planning protections, but they also give you the chance to allow your estate to avoid probate.
However, people who create DIY living trusts sometimes believe that their trusts are enough. In other words, they create the revocable living trust and then do not create any other estate planning tools as part of their overall plan.
This is a serious mistake. While it’s true that revocable living trusts are useful, no estate planning tool is enough to provide you with all the protections you need. A comprehensive estate plan includes many different tools, each of which is designed to provide specific benefits.
Moreover, the tools you create should be designed in a way so that they complement one another. For example, if you create a revocable living trust, it’s absolutely essential that you also create a last will and testament. The will you create when you have a revocable living trust will be much different than one you create if you don’t have a trust, even though the two versions must meet the same standards.
DIY Mistake 3. Not having an attorney review your plans.
Even if you create a DIY estate plan, you should always have an experienced estate planning lawyer review your efforts. If you don’t, any mistakes and omissions can turn out to be very costly.