Kiplinger's article: Cut the Lawyer out of your Will?
February 11, 2010
Kiplinger's Personal Finance Magazine has an interesting article that's coming out in the March 2010 issue, about do-it-yourself estate planning. It was written by Jane Bennett Clark, Senior Associate Editor:
You’ve been dragging your feet for ages on writing a will and drawing up other estate-planning documents. Now, to avoid the hassle and expense of hiring a lawyer, you’re considering using online forms to get the job done. Companies such as Nolo, LegalZoom and Rocket Lawyer allow you to do just that. Not only do they provide do-it-yourself estate-planning documents, but they also offer guidance on filling them out and general information on estate-planning issues.
The cost for such off-the-rack estate planning? As little as $50 for a simple will to $220 or so for a package that includes a will and a living trust. That’s cheap compared with the $300 a lawyer might charge for a simple will or the $1,000 or more that a comprehensive estate plan might run you. Still, you get what you pay for, says Danielle Mayoras, an estate-planning attorney and coauthor, with Andrew Mayoras, of Trial & Heirs(Wise Circle; $20 at Amazon.com). Although the products themselves may be sound, one size doesn’t fit all, says Mayoras. “They don’t address as many what-ifs as if you had an attorney with you.”
Last will and testament.Using an online will makes sense if your finances and circumstances are uncomplicated, says Joanna Grossman, a professor at Hofstra University School of Law, but “people don’t know whether they do, in fact, have a simple situation.” If you go the do-it-yourself route, be sure to have the will properly witnessed, says Betsy Simmons, an estate-planning attorney at Nolo. “You’re not done until you do all the things that make it official.”
If your situation is, in fact, more complex -- you want to disinherit a family member, say, or provide for a child with special needs, or shield a large estate from estate taxes -- consult a lawyer. (The federal estate tax was repealed for 2010, but Congress is expected to reinstate it retroactively.)
Revocable living trust. Often used for large or complex estates, this vehicle lets you transfer ownership of your assets to a trust that you control and avoid the public process of probate when you die. If you decide you need a living trust, hire a lawyer. Trusts are, by nature, tailored to particular situations, and they have a lot of complicated rules, warns Grossman.
A lawyer will also have you fund the trust properly, which involves transferring the title on everything -- from the deed on your house to bank and brokerage accounts -- from your name to the trust. Failure to do so (a common rookie mistake) renders the trust inoperable, says David Shulman, an estate-planning attorney in Fort Lauderdale, Fla.
Durable power of attorney. This document lets you appoint a representative to manage your financial affairs should you become incapacitated. Depending on your intentions -- and state law -- it goes into effect either as soon as the document is executed or if you become mentally incompetent. In contrast, a regular power of attorney ceases to exist if you become incapacitated. It pays to work with a lawyer to make sure you use the right documents and choose the right person for this important job.
Advance directives. You need two state-specific documents: a living will, in which you specify the treatment you want to receive if you cannot speak for yourself, and a durable health-care power of attorney, in which you appoint someone to make health-care decisions on your behalf when you cannot. They are available free through hospitals and state medical societies. You don’t need a lawyer to fill them out, but you should discuss the provisions with a doctor and your health-care proxy before signing the documents.
[click here to see the article on Kiplinger.com]
The article has some good advice. We always advocate working with an experienced estate planning attorney. People who try to use a preprinted form, or trust or will kit, usually end up costing their families much more than they save in legal fees. Don't take shortcuts with your legacy!
Posted by: Andrew W. Mayoras & Danielle B. Mayoras, co-authors of Trial & Heirs: Famous Fortune Fights! and co-founders of The Center for Probate Litigation and The Center for Elder Law in metro-Detroit, Michigan, which concentrate in probate litigation, estate planning, and elder law. Andrew & Danielle are husband and wife attorneys, professional speakers and consultants across the country.Follow us on Google+