Estate Planning Pitfall #2 - DIY Wills and Estate Plans

By Clarence Peters

Dear Son,

I’m writing to thank you for asking me about estate planning.  I’m proud of you for the gains you’ve made in life – from education to work, to making family connections.  You’ve prepared for the future before, so it’s mature of you to start planning now.  It gives me comfort to know you’re not going to leave a mess behind for loved ones should you pass on unexpectedly.

Here’s the thing.  You have been an independent person, so I know you’re going to be thinking about doing it on your own.  And you’ve had some great success with “DIY” (do it yourself) skill development.  You learned some piano tunes before you had lessons, and you impressed those Grade 9 girls!  But you realized very soon that you needed some guidance.  You found it in your teachers, who helped you grow and even earn awards, and now, to make a living from music.

We bought a book and took some instruction from videos on the internet for piano tuning and you made some money at it.  Again we bumped into a limit.  You found out that servicing a piano properly could take way more hours than you were willing to invest.  Without guidance, some things can go badly wrong!

I’m writing this, to make a point.  Know the line.  You can learn some things on your own, but at some point, things can become too complex.  We need people to walk with us to do a good job.

A lot of people think that if they can write their own Will, they can save money and have everything looked after.  It’s true, that you can sit down with a pen and hand-write your own Will.  You don’t even need a witness.  Cecil Harris, a farmer in Saskatchewan was pinned under his tractor and made his own Will, scratching it in the fender with his pen knife.

Now just because you can do it, should you?  Let me just say that many, many hand written wills fail on various points.  They fail to properly appoint an executor.  They fail to consider contingencies, like what happens if a child or their executor pre-decease them.  They fail to appoint guardians for children.   They try to do things which they can’t even do, like give something away that’s in joint ownership with someone else.  The Will gets lost or is destroyed.  The Will might not be dated and conflict with an earlier document.  They may fail to revoke all prior testamentary dispositions.  They may be hard to read.  Sometimes the writer lacks capacity.  Sometimes proper allowance is not made for a dependent.  Sometimes improper gifts are made to charity.  The list goes on and on!

Besides, the Will isn’t the whole picture.  Taxes can alter the dispositions in ways people don’t think of.  Often people fail to understand how beneficiary designations, or joint ownership (of lack thereof) can jeopardize their plan.  As an estate planner, it was sad for me to see people face complications and expense of thousands of dollars because they refused to spend a couple hundred on an estate plan.

My basic point is this.  Often we don’t know what we don’t know.  I had a conversation with a woman who did her own planning, and she said, “I think we’ve got everything in place,” but the question marks were all over her face.  The problem is, you don’t get a do-over; your family will find out how thorough you were or weren’t.

While you can never plan for every scenario that could arise once you’re gone, the good news is that you can be more certain about how your plan will play out if you entrust the creation of that plan to people who know the rules!  Amity Trust has planned and administered thousands of estates, so they know how things play out.  If you provide them with all the information they ask for, they will be able to put it all together and you can have peace about how your estate will be handled and disbursed when that day comes.   

Many people are so relieved and happy once they get this done.  It is neither as painful, nor as costly as they thought it might be.  Peace of mind comes from expert guidance.

Love,

Dad

 


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