“Self-help” and estate planning do not mix
Today, the internet gives us access to a world of information. There is the promise of do-it-yourself everything, from medical issues to legal issues and more, delivered at the click of a mouse. The public needs to beware. Self-help and estate planning do not mix.
Just as WebMD.com is no replacement for a physician, websites that create legal papers after you fill out a questionnaire and pay a nominal fee are no replacement for a properly prepared estate plan from a lawyer who is serving you. Self-help and estate planning do not mix.
By way of example, let’s say Frank and his wife, Kristi, came into the office with an internet-driven will. They thought it accomplished their objectives — all to each other, then to the children, Ivan and Maxine, in equal shares. They wanted to make sure administration was easy for their children, with the least amount of cost and conflict. Frank and Kristi owned a home in South Carolina and in Florida. I explained to them that assets governed by a will must go through probate, or court-supervised administration, and that real estate in Florida would also need to go through probate in Florida. This means another lawyer, more legal fees and more court costs. Also, Ivan had a child named Kevin, who had autism, and a wife named Stephanie, whom Frank and Kristi did not trust. What should Frank and Kristi do?
Instead of using a will alone, which would mean hefty legal fees and court processes in two states, they should use trusts. Assets in a trust do not go through probate. The successor trustee becomes the fiduciary and has the responsibility to follow Frank and Kristi’s instructions. The court does not need to be involved. They should leave Ivan and Maxine their equal shares in a trust each child controls for their own benefit, so it will be protected from lawsuits, divorce, estate taxes and probate, and so it will stay in the family bloodline. Doing this will prevent Stephanie from inheriting Frank and Kristi’s property, and when or if money eventually goes to Kevin, it can be left in a trust that will supplement benefits he may receive from the government. We do not want Kevin to lose his benefits, and we do not want Stephanie to receive Ivan’s inheritance.
Luckily, Frank and Kristi were smart enough to realize their internet-driven will might not serve them well. They were right. Fortunately, we structured their legal affairs to guarantee minimal court involvement, maximum privacy and protection, and to make sure Kevin will not lose government benefits and Stephanie will not inherit their hard-earned money.
The moral of this story is that good planning will protect you and your family, and self-help and estate planning do not mix.
Mark F. Winn, Master of Laws (LL.M.) in Estate Planning, a local asset protection, estate planning and elder law attorney serving the lowcountry for more than 20 years. www.mwinnesq.com
