Is Do It Yourself Estate Planning Right for You?

This article is not a substitute for, nor does it constitute, legal advice. Only an attorney who knows the details of your particular situation can provide you with legal advice.

Is Do It Yourself Estate Planning Right for You?

There are more options out there than ever for somebody looking to draft an estate plan. It can be overwhelming to figure out what’s right for you. This article will examine some of the pros and cons of each of the various methods available to you to draft a legally operative estate plan.

So what are your options? For starters, form banks like LegalZoom and LivingTrust provide users with legal document templates where you choose the right template for you, fill in the blanks, and voila- you have a legal document! Or you can hit the books and learn how to do it yourself with guides such as the Nolo series. Another option is the tried-and-true method of consulting your estate planning attorney. Regardless of the path you choose, you should remember to think long and hard before doing anything that could have serious implications for yourself, your business, and your family.

Form Banks

If you have a relatively straightforward estate plan and want to create your legal documents quickly, then form banks might be right for you. Businesses such as LegalZoom, LegacyWriter, and Incorporate sell legal document templates online. You start by going to the appropriate website, then find the legal document template you are looking for, and after you have filled in the blanks and performed the formalities you will have a personalized legal document.

The biggest advantage form banks provide is that they are straightforward, quick, and easy. You can literally draft a legal document in just a few minutes.

Another advantage offered by form banks is their cost.  While they are not as cost-effective as doing it yourself, they can be less cost-effective than hiring an attorney to draft your legal document. However, the disadvantages of using form banks may make them a bad choice for you.

The key disadvantage of form banks is that if you use one, you might not get what you expected. What I mean is that many people either fail to meet the very specific formalities required to make the document legally operative, or the document is legally operative but with unintended legal consequences. For example, a person might think he has a legally operative will but really it is not. Then that person’s entire estate passes into probate once he has passed. Or somebody uses a form bank to draft a will and creates a legally operative document but ends up giving all of his estate to his daughter when he also wanted to give some of his estate to a dear friend. The lesson here is that you want to be very sure of exactly what you are doing whenever you use a form bank.

Another disadvantage of using form banks is that you run the risk of receiving poor customer service. Just a cursory Internet search will find hundreds of customer complaints about the poor customer service provided by these businesses. The chief criticisms tend to be that either the customer service is slow to respond in time-sensitive matters or the customer service is unknowledgeable regarding the law behind the documents. Many businesses running a form bank make sure to absolve themselves of any and all legal liabilities so that they cannot be sued by unsatisfied customers. You do not want to be left high and dry after having shelled out the money for a legal document template and then find yourself either unable to create the document you wanted and/or unable to seek any redress from the business itself.

The final disadvantage with form banks that I will address is their lack of customizability. One size does not fit all when it comes to planning for your future.  For example, form banks often fall short if you want to plan for contingent beneficiaries or create a spendthrift trust. Not only do form banks frequently fail to provide you with high customizability, but also they frequently do not provide you with the guidance to get the best document for you.

Overall, my conclusion on form banks is that you should only use one if you know exactly what you are doing and have a fairly straightforward goal in mind. Otherwise, you may find yourself having to pay an attorney to undo the damage caused by using one of these sites. Inform yourself or ask an attorney to review your document before making it legally operative. Remember, an ounce of prevention is worth a pound of cure.

Do It Yourself

There are various resources available for the confident self-starters who are willing to draft their legal documents on their own. Good examples include Nolo, the “For Dummies” series, and reading the practice guides at your local public law library. If you choose to do it yourself, you will probably spend a lot of time learning the law but could save yourself some cash.

The biggest advantage this choice offers is the low cost. You can usually borrow or at least read many of these books for free if you pay a visit to your local library. If you are the rugged individualist who can competently handle matters on your own, a do it yourself approach might be for you.

On the other hand, many of the same criticisms that apply to form banks also apply to doing it yourself. When you want customer service, look in the mirror. Not to mention that you might end up creating a legal document with unforeseen consequences. Or you might end up creating a document with no legal consequence at all. In the worst case scenario, you will end up having to pay an attorney to undo your mistakes.

As far as do it yourself legal document drafting goes, you should probably only do it if you are a quick study, have a lot of free time, or are professionally trained in estate planning. Otherwise, you might end up spending your valuable time to create an unwanted, ineffective, or unmanageable legal document.

Consulting an Attorney

Attorneys have been drawing up estate plans for centuries. The ups and downs are two sides of the same coin- usually you receive quality, personalized service but might end up paying a premium for it.

The best part of consulting a skilled estate planning attorney is that a professional can usually see ways to maximize your benefits and minimize your liabilities that most people cannot. You should expect nothing less if you are hiring a trained professional whose goal is to help you meet your estate planning needs.

The biggest downside to hiring an attorney is that an attorney’s services can be prohibitively expensive. But that is not always true- many attorneys have flexible billing rates. Also, when it comes to making decisions that have serious implications for our futures, sometimes it makes sense to spend more.

Mixing and Matching

You might be able to maximize the benefits of each of these approaches while minimizing their downsides by combining them. Let me be very clear on this next point- regardless of the path you choose, you should at least do enough research to get an idea of what you want your estate plan to accomplish.

If you have a straightforward estate plan you should either use a form bank or an attorney to draft your document. But if you have a highly customized estate plan or want to strategize as far as how to best allocate your assets, it’s probably best that you involve an attorney throughout the process.

No matter what, it’s a good idea to have an attorney do a brief review of any legal document you have created to make sure you have crossed your “T”s and dotted your “I”s. Doing so will be more cost-effective than having an attorney draft the whole thing. This maximizes the benefits provided by each of the above approaches.

I hope this article has helped you to understand some of the strengths and weaknesses of the different options out there for estate planning. Just remember, take your time when planning your estate. This is an important decision that will affect you and those you care about for years to come.

The entirety of this article is copyrighted by Grant A. Toeppen, Esq., © 2012.  Please send an email to Grant@ToeppenLaw if you would like to use this article in part or in its entirety.


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