DIY Estate Planning is No Bargain
- The purpose of estate planning is to protect your assets and your loved ones.
- While DIY estate planning is rising in popularity, the risks involved are numerous, including documents not being legally valid in your state, your goals not being met properly, and unintended consequences due to the complexities within your own estate.
- Your estate plan should include various documents, such as a will, trust, powers of attorney, and medical directive or health care power of attorney. Which documents you need depends on your assets and intentions.
Over the last decade, the do-it-yourself (DIY) philosophy has grown exponentially and now has spread into estate planning. However, just because these documents are labeled “fast” or “easy” does not mean they will protect your beneficiaries.
DIY estate planning has numerous pitfalls that could leave your estate and its beneficiaries vulnerable. Your documents may not be legally binding, risk being contested by someone unhappy with the results, and many more complications.
People interested in estate planning should discuss their options with a knowledgeable estate planning attorney who can work with you to find the solution that works for your goals and create legally binding documents to fulfill them. Doing so can protect your assets and the loved ones you wish to leave those assets to one day.
If you are already thinking of creating an estate plan and want to do it yourself, you should take a moment to understand the risks. You need to ask yourself whether your DIY plans are doing a disservice to yourself, your estate, and your beneficiaries. You spent your entire life working to accumulate the assets you now have. Why trust the distribution of those assets to an online, check-the-box program? Isn’t it time to seek legal advice from an experienced Virginia estate planning attorney at Midgett Preti Olansen?
What is Estate Planning?
In Virginia, estate planning is the preparation of a legal roadmap for the distribution of your assets. It usually includes an outline for distributing your assets after you pass, documentation for end-of-life healthcare, and financial management. It is a way to express your wishes, name your beneficiaries, and provide for those you love.
Risks of DIY Estate Planning
There are several risks of tackling your estate plan by yourself. These are the problems we see most frequently with DIY estate plans.
1. Documents Are Not Valid in Virginia
Every document in your estate plan must meet certain requirements to be legally valid. If not, a court can deem them invalid, and your assets may be distributed according to the laws of intestate succession.
Unfortunately, do-it-yourself planning today has created all new issues. Many of these issues are due to people relying on internet research, and there is just too much (poor) information to sort through. Clients often do not realize that they are reading information about another state’s laws or that is written by a non-attorney. There is also a wealth of misinformation online about estate planning. When someone relies on internet research for their estate planning, the documents created may not be valid here in Virginia. This can cause major problems for their loved ones.
2. Documents Not Covering Your Estate Goals
While you may know what you wish to accomplish with your estate plan, parlaying that into an actual legal document can be challenging. All too often, DIY documents do not completely cover your estate planning goals. While you want to feel confident that your assets are distributed to the correct beneficiary and your estate is not subject to unnecessary taxes or penalties, you cannot be certain if you create DIY documents.
For instance, a client came to us in a situation where the decedent had intended to disinherit someone but failed to do so properly. They included a no-contest clause within the document that they did not understand, which complicated the execution of the will. The result was that they did not accomplish the goal of disinheriting that person and the estate ended up in litigation.
Had the deceased consulted with a knowledgeable Virginia estate planning attorney, the situation could have been avoided. Because they chose DIY estate planning documents, their will did not meet all their goals.
3. Complex Situations Within Your Estate
Estate planning becomes more complex when you have substantial assets, changing family dynamics, or business interests. If these issues are not addressed properly, poorly drafted documents can cost you and your loved ones time, money, and distress. One situation we have seen all too often is when people create trusts and do not fund them. Additionally, they do not have a proper will to transfer assets to the trust and avoid probate. Despite their effort to develop an estate plan, their loved ones are still at the mercy of the probate system.
An Example of Why You Might Want an Estate Planning Attorney
In a recent case in Virginia (Irving v. Divito), the decedent, when still alive, attempted to modify his estate plan on his own instead of consulting with an attorney. Here is what happened.
During a divorce hearing, Mr. Irving entered into a property settlement agreement, which included a statement that no children were born of this marriage, and the infant known as Patrick was not his child. Despite that statement, the decedent’s existing will identified Patrick as his child.
Mr. Irving’s estate planning documents contained the will and another document that advised him not to make any changes to the face of the will without first contacting an attorney. So, rather than write directly on the document, the decedent wrote the following on a divider tab: “I wish to remove Patrick, named as my son, entirely from the will — no benefits.” He wrote his initials below the note.
Upon Mr. Irving’s death, the will and binder page were submitted to the clerk for probate. The clerk admitted the will but refused to admit the binder page tab as a validly executed codicil or amendment. The court found that the document was written and initialed by the decedent. Still, it concluded that the decedent had used his full signature on all formal documents, such as the will and property settlement agreement. Therefore, the tab divider was not validly signed.
The Court refused to probate the writing as a codicil. While noting that Virginia law does not define what constitutes a signature and that even initials can be sufficient, the Virginia Supreme Court declined to accept the binder page as an amendment to the will. The fact that the decedent used his initials for this attempted change but not his other documents cast doubt on his intent to authenticate the change. Therefore, the decedent’s attempts to remove Patrick from any benefit under the will failed.
The moral here is that attempting to save a little bit of money by doing it yourself instead of seeking the assistance of a professional can cost a great deal more in the end.
Documents That Should be Included in a Virginia Estate Plan
These are the various estate planning documents individuals should include in their plans. A Virginia estate planning lawyer can advise you on the combination of documents you need based on your assets, wishes, and other considerations.
- Trusts: A trust is a specific legal vehicle that holds property for you on behalf of your named beneficiaries. The benefit of a trust is that the property can be distributed quickly, and privately, without going through the lengthy probate process.
- Wills: This legal document names an executor and guides them on how you want your assets to be distributed. Without a will, you die intestate, meaning Virginia law will determine what happens to those assets.
- Life insurance: Life insurance is paid out directly to your designated beneficiaries. It can be beneficial in a number of ways, including providing financial help to care for loved ones and pay expenses, debts, and administration costs. In large estates, life insurance is used to help offset the cost of estate taxes.
- Medical directives: In a medical directive, you can name a trusted person to make important healthcare decisions for you should you be incapacitated and also express your preferences, such as for end-of-life treatments, do-not-resuscitate orders, and anatomical gifts.
- Powers of attorney: This legal document gives another person the authority to make financial or legal decisions on your behalf if you cannot do so for yourself.
Why Work with Midgett Preti Olansen
Protecting the assets you have worked your entire life for is paramount. You can accomplish this by being thorough in your estate planning. At Midgett Preti Olansen, we understand this and will start by getting to know you and your goals before recommending actions. With over 100 years of combined experience in estate planning and administration in the Hampton Roads area, we can help you every step of the way, creating the documents you need, providing ongoing estate administration, and, if ever necessary, fiercely litigating on your behalf.
Testimonials
“I just met with Attorney Stephanie Smith… wow, it was like talking to a best friend from many years back about my will, trust, and medical directives. Excellent group, very knowledgeable law firm!” — Bill K.
“Went to the law firm of Midgett Preti Olansen (MPO) for the first time last week. My appointment was with Mr. Nathan Olansen to have a new will and trusts set up for me. Mr. Olansen was professional, courteous, and knowledgeable. He carefully listened to my concerns, answered all of my questions, and gave me important advice. I never felt rushed during our first meeting either. Have several papers that I received from him, which I will complete before I go back next time. Mr. Olansen informed me that we will have at least two more appointments. He told me the amount I would have to pay for his services, and I felt it was a fair price. I found it very comfortable dealing with Mr. Olansen, and I look forward to our next meeting.” — K. Susan H.
Additional Resources
- Reasons Why You Should Hire a Professional Executor: Learn about the fiduciary duties of estate and trust management, how to select an executor or trustee in Virginia, and why you should consider hiring a professional.
- How Estate Planning Works: Gain a clearer understanding of estate planning by learning about available tools, including life insurance, annuities, and trusts.
- What is the Difference Between Trustee, Executor, and Power of Attorney?: Learn how a trustee, executor, and power of attorney differ and how they must work together.
Are You Willing to Risk Your Life’s Work? Contact MPO to See How We Can Help.
While creating a DIY estate plan may save you time and money upfront, much can (and probably will) go wrong, and you will be risking your life’s work and your loved ones’ inheritances. Instead, reach out to the Virginia Beach-based law firm of Midgett Preti Olansen for help. We can draft your estate plans and continue to advise you in the future so that your documents continue to represent your wishes. We serve the entire Hampton Roads area and will take the time to get to know you so we can tailor an estate plan to your needs. Call our Virginia Beach office today at 757-687-8888 or contact us here to schedule your consultation.
Frequent Answered Questions
The cost of an estate plan will vary based on the amount and complexity of the assets involved. Several factors can lead to complexity, including having a child with special needs, various challenging family dynamics, and business interests. The large majority of our estate plans are prepared for a fixed-fee which we will provide to you after our initial consultation.
Unless you have been to law school, passed the bar exam and practiced law for several years, we do not recommend that anyone create a DIY estate plan because estate plans and family dynamics are inherently complicated. If you decide to create your own estate planning documents, we recommend you at least seek a legal review of those documents with an experienced estate planning attorney.
