DIY Wills and Will Kits
Do It Yourself Wills and Will kits are a tempting option for those on a budget because they offer a cheap solution to having a will drafted by your solicitor.
Wills drafted by suitably experienced estate planners are no longer cheap however it is important to understand that an estate planning solicitor does a lot more behind the scenes with regard to reviewing your situation. Without legal training you often unaware of the implications your personal and financial situation could have.
But my affairs are simple?
Many people think their affairs are simple and a will kit would be suitable. However quite often it is found that people do not have the simple affairs they initially thought. The law covering estates is complex. An understanding of the multiple pieces of legislation surrounding estate planning as well as a sound understanding of how the courts interpret the common law is important to make sure your wishes are fully put in place.
The following common situations are rarely appropriately covered by a will kit:
- Blended families and children from multiple relationships;
- Children and/or grandchildren under 18 years of age;
- Other parties financially dependent upon you;
- Family members with a disability;
- Family members facing insolvency;
- Family law matters;
- Consideration of taxation issues;
- Assets held by other entities such as companies;
- Family trusts; and
- Dealing with superannuation and life insurances.
In fact, most of the professional fees that you pay are not for the piece of paper that is your will, but for the review of your situation and the advice given to you situations such as jointly owned assets, assets held by other entities, practical considerations and knowing the risks that your estate is exposed to from members of your family contesting your will.
The following is a summary of the most common mistakes with will kits that we have seen over the years that have resulted in many thousands of dollars being expended by the estate in rectifying the omissions:
1. Failing to appropriately identify parties in your will
This can be incorrect spelling, failing to think ahead (i.e. at the time you did the will you had two children and down the track you had more), failing to appropriately describe people so that they can be identified. This then requires an application to the court and evidence given identifying the person you intended to name in your will.
2. Failing to properly execute your will
The use of white out, not signing every page, not having two adult witnesses witnessing the will, having the wrong clause stating how the will was reviewed by the willmaker for instance where the willmaker cannot read, is sight impaired or cannot sign, can all render a will invalid. Failing to properly date it can also leave wills susceptible to a challenge that it was made before what was in fact a previous will.
3. Not appointing appropriate executors and trustees
Many times people appoint their family members without giving consideration to whether they can appropriately manage the responsibility. Sometimes the role of an executor or trustee can last for many years, such as where there are minor beneficiaries to be cared for or a life interest over property. It is very important to ensure that the people appointed can manage any of these issues and can work together efficiently.
4. Giving away assets that you don’t actually own or cannot be divested through your will
It is important to understand how you hold property. The investment house that you intend to leave to your son could be owned by your family trust and the control of that passes from the trustee to somebody other than the son you intend to leave it to. You may wish to leave your interest in a bank account that is held jointly with your spouse to your children, because of the nature of the bank account those wishes will not be carried into effect.
5. Leaving family members out of your will
Sometimes you can inadvertently leave out a gift to a family member or in fact you do not intend to leave them anything for a variety of reasons. An estate lawyer can assist you with the appropriate documents to lend weight to your decisions and provide advice about the risk of your estate being contested so that you can make an informed decision.
6. Poor drafting of gifts
You may choose to leave the house you live in to your children. If you subsequently move house and this is not appropriately drafted, that gift would fail and the house that you have moved into in substitution for the house referred to in your will would not be gifted to your children. Again an application to the court would be required to attempt to rectify this however the costs are high and the outcome is often uncertain.
7. Failure to understand estate planning laws
Failure to give consideration to the tax implications on which the way your gift is dealt with; sometimes the wording used in a will can result in a transfer of an asset become a taxable transfer whereas separate or different wording would result in it being a tax free transition.
8. Handwritten amendments
As most will kits are fill in the blank wills it is important that all of areas are appropriately signed, initialled and witnessed by all parties necessary to sign the will in each and every instance. Failure to do so could render those gifts or the entire will invalid.
Often people think they have dealt with all of their assets and fail to put in a residue clause. This can result in a partial intestacy of your will and the assets not appropriately dealt with in your will kit will be dealt with under the succession law which may not be in accordance with your intended wishes.
Each of these omissions can result in the failure of your wishes to be put into effect and potentially thousands of extra dollars in legal expenses being borne by your estate. It is always advised that you have your will and other estate planning documents prepared by a solicitor who is experienced in estate planning.
At Wright Clarke Solicitors we are happy to give you a complimentary half-hour estate planning review so that we can provide you with an estimate of costs and provide you with advice on how to best manage your affairs so that your wishes can be put in place for your family after you’re gone. We can also come up with arrangements in order to assist you with paying for your estate planning if necessary.
Please contact Emily Templeman, our estate planning and administration clerk on 07 4992 2722 if you are interested in arranging a consultation.