Estate Planning: Where Doing it Yourself, Doesn’t Mean Doing it Right

May 25, 2011

Want to find a hotel for your upcoming trip? Want to know what tomorrow’s weather will be? Want to make a Will? These questions seemingly have nothing in common, until you consider that the answers to them all can be found on the Internet. In fact, the Internet has become the top resource for people looking to cut out the middle-man – whether he is the travel agent, the weatherman, or the attorney - all in favor of doing it themselves.

While several websites, including and, offer users the ease of creating estate planning documents at the click of a button, the estate planning documents created are often flawed, and sometimes even invalid. People who believe that they can utilize one of the many online estate planning programs and secure the same product and education they would receive from a real life estate planning practitioner, are seriously misguided.

The estate planning process is just that, a process. Our approach to estate planning involves a discussion of not only a client’s plan for his or her wealth after death, but also a discussion of one’s financial assets and tax planning strategies. While many of our clients know that there is a Federal Estate Tax, most do not know that there is also a New Jersey Estate Tax, which is assessed on Estates valued in excess of $675,000 (a mere difference of $4,325,000 from the federal exemption amount). Therefore, during our initial client meetings, we are charged with explaining such nuances to our clients. This is something that the customer service representative at will not do.

The in-person guidance offered by an attorney cannot be replaced by answering questions on an on-line decision-tree. For example, many clients do not understand that a Will only disposes of their probate wealth. Assets like IRAs, life insurance policies, and bank/investment accounts titled in joint names with rights of survivorship will not pass under a Will, which can often frustrate any tax planning contained in both stock and personalized legal documents. One of our key roles as estate planning attorneys is to assist clients in re-titling their assets to ensure that enough wealth passes through a Will to take advantage of the tax-savings available to any one person’s Estate. Furthermore, an on-line decision-tree will not contact you when applicable laws change (which occurs quite often in the field of taxation), and will not periodically reach out to you to see if your financial situation has changed to require a similar change in the planning documents you executed ten years ago.

Additionally, owing to years of study and practice, attorneys are trained to identify potential problems with an estate plan, which a do-it-yourselfer may have never even considered. Examples of such problems are ademption (when you devise a specific item of your Estate to a named individual and you die without owning that item), gifts to minors or young adults (who’s moneys should be held in trust until a certain age), gifts to a person with special needs (who’s moneys should be held in trust in order to maintain their eligibility for government assistance), and who should inherit in the case of common disaster (where would assets pass if all of the persons named in a Will predecease the testator). Perhaps most importantly, an attorney can counsel their clients to implement sophisticated tax planning strategies, most of which are foreign to lay people, and are best understood only after a comprehensive and continuing education in the field of taxation.

In following with the theme of in-person guidance, one of the most common errors associated with do-it-yourself estate planning documents is their improper execution. Just as sixteen states have separate estate tax schemes, each of the fifty states require different elements to properly execute a Will, and the effect of non-compliance with any state’s rule can potentially invalidate the provisions of your on-line purchase. In New Jersey, a Will must be signed by a testator before two witnesses. Furthermore, New Jersey provides for a self-proving affidavit, which is to be signed by the testator, the witnesses, and a notary public, and allows for probate without requiring the witnesses to appear before the Surrogate to prove the valid execution of the Will. Thus, even if your self-created Will contains the correct provisions for the disposition of your assets, if you do not execute your Will in accordance with requirements of your state, your Will may be useless. Conversely, an attorney guides you through the execution process, providing you with the witnesses and the notary, and is solely responsible for ensuring that your Will comports with the letter of the law.

Furthermore, one of the benefits associated with making a Will in New Jersey is the ability to bypass formal probate. However, formal probate, which consists of the costly submission of legal pleadings to the Surrogate, may be required if the Surrogate feels that the look and form of your Will is suspicious (something that has been known to occur in cases where testators use on-line stock Wills).

Although there are limited cases where a do-it-yourself Will may be sufficient, it is our strong recommendation that you consult with an attorney to help you plan for the disposition of your Estate. What many consumers of do-it-yourself estate planning products do not realize is that they are paying good money for documents which may or may not be completely effective, and the danger of an ineffective document is that your up-front savings will end up costing your heirs more money, and certainly additional headaches.

While the Internet has proven to be a useful tool for choosing a good four-star hotel, or finding out whether you should take an umbrella on your morning commute, it certainly cannot replace the expertise of an estate planning attorney with substantial experience, who is willing to give you the time and personalized service that your financial situation deserves.

For more information please contact Jodi C. Lipka.