Beware of DIY Wills and Trusts: Your Family Situation Impacts Your How You Leave Your Legacy

Every family is different. In some families, there is one breadwinner and sometimes both spouses work outside the home. Some families have children, while others are childless. Blended families bring children from previous relationships. Because there are many different life circumstances that go into making a family, there really is no one-size-fits-all approach to structuring your estate plan and the legacy you hope to leave behind. That is the primary reason why online DIY wills and trusts often fail. They don’t take into account the unique situations that could impact your financial life. Here are a few examples.

The Age of Your Beneficiaries Could Affect the Legal Tools You Need to Use

Perhaps you want your young children to inherit everything you own, so you buy a cheap online Will and consider everything taken care of.  But, if your children are minors, they can not inherit directly from you, nor manage money on their own if they are underage. You would need to know about your other options, such as being able to transfer assets under the provisions of the Uniform Transfers to Minors Act, which would allow you to specify who should manage the money for the child until the child becomes an adult, or using a Trust for greater control over who manages the assets and when the inheritance should be used.  Again, an online service is unlikely to tell you that your wishes for your estate are not possible under the law.

Having a Disabled Family Member Could Impact the Way You Leave Them Money

If you want to leave money to a loved one with special needs, you need to be mindful of the fact that providing a large inheritance could potentially cause a loss of access to means-tested benefits such as Supplemental Security Income (SSI) and Medi-Cal. You do not want to be responsible for your loved one losing important government benefits—which could happen with one simple oversight or mistake when using a DIY plan. With disabled beneficiaries, it is often best to use a Special Needs Trust or other legal tools to transfer assets in an appropriate way that protects their benefits.

Your Role as a Family Breadwinner Could Affect the Way You Transfer Assets

If you have loved ones who depend upon your income, you may wish for your inheritance to help them to maintain their quality of life after you are gone and no longer able to provide financial support.  But, a having a Will alone may actually complicate your wishes…and a DIY program won’t tell you about this possibility. Unfortunately, if you have a Will only, your loved ones will have to go through Orange County probate to receive their inheritance. Probate is a very lengthy process that can take months or even years.  During that time, your loved ones could experience financial hardship while they wait for the green light of a judge.

If you talked to an attorney vs. using a DIY Wills and Trusts platform online, he or she would have likely advised you instead to use tools that ensure assets transfer outside of the probate process, such as creating a Trust.  This would ensure that your money transfers quickly without your loved ones having to go to court or experiencing other unnecessary delays.

Be sure that the legacy you leave is a blessing to your family by talking to an experienced estate planning attorney. If you live in the Orange County area, we’d love to help you make sure that happens. Call our office at (949) 260-1400 and schedule a complimentary Family Wealth Planning Session today.

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