I’m often asked, “When should I do estate planning?” The answer for the majority of the population is now. For some, the need to name guardians for their minor children is the motivator for getting planning in place. For others, the fuel to their planning fire is a special needs child, a feuding family, an upcoming foreign vacation, a child struggling with addiction, wanting to prevent minor children from getting their share of life insurance and other inheritance at the green age of eighteen, the need to reduce estate tax exposure and the list is nearly endless.
The next question I hear in phone consultations is often, “Can I do an online will or trust?” Yes, you can, but that doesn't mean you should. Do-it-yourself will and trust software claim credibility because their documents “have been enforced in court” (or “held up” in court). While some may be sufficient, I have seen numerous documents produced by online programs that are nonsensical, don’t state what the client thought they did, or simply fail to consider the scenarios that should be covered by the most basic will or trust. Beyond that, will software cannot take the place of a licensed attorney listening to your specific situation, internalizing your objectives and creating a plan tailored to meet your needs while making the least number of concessions possible.
A couple recently approached me with concerns about naming their son, a long time prescription drug addict, as a beneficiary of their estate.“We love our son and don’t want to disinherit him, but he is addicted to drugs and we’re worried that he’ll blow the money on drugs.We wish we had another choice,” they explained. By utilizing a living trust, we were able to provide the son an opportunity to qualify as a beneficiary contingent upon his achieving certain milestones and proving sobriety to the managing trustee after the death of his parents. The couple had been unaware of the flexibility a trust can provide and, without having sought the assistance of an attorney, would likely have disinherited the son that they very much wanted to name as an heir of their estate.
In countless other matters, I have helped clients provide for the care of their special needs child. When dealing with beneficiaries with special needs, it is important to engage in planning so that the child inherits without jeopardizing his/her ability to qualify for Medicaid or other government benefits. Too often a special needs beneficiary’s government benefits are endangered by their direct inheritance of monies from a parent or loved one. Too many families with special needs children make the mistake of either 1) disinheriting the child (because the parents are aware that government benefits may be at risk) or 2) naming a disabled child as a direct beneficiary, unintentionally jeopardizing government benefits. Government program guidelines vary from state to state and online software likely cannot tailor your plan to protect your special needs child in the way that a live and licensed practitioner can.
In short, a do-it-yourself will may be valid, but it likely won’t cover all of your bases or accomplish everything you intend for it to. Beyond that, you may be surprised at how affordable estate planning actually is.