The process of estate planning involves the execution of legally binding documents. It is possible to purchase generic, template documents online. There are companies that sell last wills and other estate planning documents.
Is DIY estate planning effective? Let’s look at the facts.
Choosing the Right Documents
When you think about estate planning, you may assume that you should use a last will to state your final wishes regarding the distribution of your assets. It is possible that a last will would be perfectly suitable for you, but there are a number of things to take into consideration. A last will may not be the best choice.
One thing to consider is the matter of probate. If you use a will to facilitate asset transfers, the will must be admitted to probate after your passing. The executor or personal representative cannot distribute assets to the heirs until this process has run its course.
A simple case would probably take close to a year, and more complicated cases can take longer.
There are various different ways that you can arrange for assets to be transferred outside of probate.
Probate avoidance is one thing to think about, but there are numerous different circumstances that can exist.
Do you have a loved one with a disability? Many people with special needs are enrolled in the Medicaid program. This is a need-based health insurance program.
If you named a benefit recipient in your last will, the inheritance would change his or her financial status. As a result, Medicaid eligibility could be lost.
Do you have estate tax concerns? Do you have a spendthrift heir on your inheritance list? Is asset protection important to you? A last will would not be the right choice if you have any of these concerns.
Even if you choose the right estate planning document, you may want to take pause before you buy into any DIY notions. In 2012, the highly respected magazine Consumer Reports decided to put do-it-yourself estate planning under the microscope.
Staffers created last wills using downloads that they obtained through three of the leading online purveyors of legal documents. The magazine engaged a trio of legal professors to examine these last wills.
The professors found flaws, and Consumer Reports ultimately advised against DIY estate planning.
Dangers of DIY Estate Planning
There is nothing wrong with taking on certain types of DIY projects. It can be fun, and it can save you money. At the same time, you have to know where to draw the line.
If you would like to learn more about the dangers of DIY estate planning, download our special report. This report will provide you with more expansive information, and you can obtain access through this page: DIY Estate Planning Report.
- Generational Wealth is Key to Leveling the Playing Field - November 24, 2020
- Fair Isn’t Always Equal and Vice Versa - November 19, 2020
- Staying Current is Especially Important in the Pandemic - October 28, 2020