Why DIY Wills are so bad

The Western Australian Supreme Court publicly stated in a 2014 judgment that “Homemade Wills are a curse,” and inevitably lead to protracted and expensive legal battles in family disputes involving substantial estates.

The Court said the legal issue around the proper determination of the deceased’s Will could have been avoided if he had “consulted a lawyer and signed off on a Will that reflected his wishes”.

The Court warned of the dangers of homemade Wills, saying there was no question that engaging a properly qualified and experienced lawyer to draft a Will was “money well spent”.

“But where, as here, the estate of the deceased is substantial, the Will is opaque and there is no agreement among the beneficiaries, the inevitable result is an expensive legal battle which is unlikely to satisfy everyone.”

One of the issues with DIY Wills is that it gives Willmakers (‘Testators’) an inflated sense of their ability to create an effective and efficient estate plan, without equipping them with the necessary understanding of the risks they are taking.

Most people only have 2 tasks in mind when creating a DIY Will:

1. Listing their assets; and
2. Deciding who should receive their assets when they die.

But estate planning takes a lot more thought than that.

Before you can decide what to do with your assets when you die, you need to think not just about what they are, but what they are likely to be when you die.

This may seem like an easy question, but it can be harder to answer than you first think.

It is not uncommon for people to ‘control’ assets that they do not own outright. It is only the assets that you own outright in your name alone, that you can give away in your Will.

The 2 largest assets for most people are their family home and their superannuation.

However it is quite possible that NEITHER of these assets will be dealt-with by your Will.

For example, you might own the house as joint-tenants with another person (typically your spouse/partner).

This means that if you die before your spouse/partner, they will receive that asset by right of survivorship, and the reference to it in your Will could be irrelevant.

If you have created a Death Benefit Nomination in your superannuation (say to your spouse/partner), then this nomination is likely to operate to direct the death benefits of your super to that nominated person, bypassing your Will.

Other examples of assets that you might think that you own, but actually only control, are: assets held in trust or through a company, and assets with nominated beneficiaries (life insurance, super).

Then there are categories of assets that are ‘encumbered’, such as where there is a mortgage or a guarantee.

Partnership assets can be problematic. Assets owned by companies have their own set of complexities.

Next we turn to the fraught issue of promises and expectations. When rugged individualists make their Wills, they tend to expect to be able to do whatever they damn well want to do with their assets.

After all, they can do what they like with their own money while they are alive, can’t they? Well … actually no. There are restrictions and exclusions even then.

EG it looks like you are about to run into financial difficulties, so before that happens, you quickly transfer all your assets to a trusted friend so that your creditors cannot attack them.

It’s still your money, so surely that’s OK? Nope. The Trustee-in-Bankruptcy can ‘claw back’ such transfers for up to 5 years before your bankruptcy.

The same sorts of restrictions to your ‘testamentary freedom’ will apply to your Will.

If someone can prove that you promised them something, and they acted in reliance upon your promise to their detriment, then they may have a claim against your estate regardless of what you say in your Will.

A typical example is where an old farmed has his son work on the farm for low wages for years on the strength of the promise to leave the farm to the son in the old man’s Will.

Then the old man remarries late in life and tries to leave the farm to his widow. The son can sue the estate.

Every State and Territory in Australia has ‘Family Provision’ legislation which permits certain categories of close relatives (typically spouses and children) to apply to the Court for greater provision out of the estate than that left to them in the Will.

So ‘unfettered testamentary freedom’ does not exist, and people making DIY Wills without the benefit of specialist legal advice are playing Russian Roulette with their estate and their family’s future.

Some people resist or resent spending money on estate planning, because they think they won’t gain the benefits themselves.

In difficult financial times like these, some folks may be tempted to postpone or minimise what might seem like a non-essential expenditure.

For a long time on Australian television, thousands of advertisements from insurance companies encouraged people to bypass lawyers and create their own Wills, using cheap or free “Will kits”.

The big ugly truth about these kits is that people make a lot of mistakes when they try to create their own Wills and estate planning documents.

They have been lulled into a false sense of security. But answering just one question incorrectly or overlooking something such as appointing a guardian for children can lead to major problems down the road.

There are lots of traps for the unwary, and this whole area of law regarding deceased estates contains a hidden minefield which you absolutely want to avoid.

And with a bit of education & planning, they can. Otherwise they won’t know the questions to ask, or what to do with the answers.

Genders and Partners is the oldest law firm in South Australia (established 1848).

Our work is targeted towards 2 main areas. One is called Estate Planning. This includes the preparation of legal Wills, Powers-of-Attorney, Advance Care Directives, End-of-Life Directives and similar matters.

The other area relates to Estate Administration, which includes Probate, intestacy, contested estates, Inheritance Family Provision claims, Protected Estates, dealings with Public Trustee; Guardianship hearings, Deeds of Family Arrangement, community treatment orders and financial administration orders.

One area logically leads to the other, so that if an estate plan is deficient, the administration of that estate will be more problematic.

While most lawyers charge an hourly rate, Genders and Partners also offer flat fees for packages of estate planning documents, so that you are not having to make an open-ended commitment on legal fees.

If clients’ affairs are more complex than standard, we give them a firm estimate of the total cost before they incur additional charges.

We really enjoy getting the best possible result for our clients, and encouraging them to think and plan ahead, to minimise or avoid grief for themselves & their families down the track.

It is all about Peace-of-Mind for our clients, and we are proud to be able to say that we enjoy lifelong relationships with our clients.

We work with each client on an individual level, to create an integrated plan that is personalised just for them and we prepare all their legal documents within their estate plan so that they work together.

We supervise the proper execution of all the documents, and we store them securely.

Many Australians have no idea what happens after they die without a Will or estate plan, and sadly many rely on the misguided notion that a FREE or cheap DIY kit Will is good enough to protect their family and assets.

Any mistakes you make with those kits (which are really just expensive stationery!) can end up costing your family later on (disputed estates, family distress, huge litigation costs). What backup and support will you get? If you go down this path then – Buyer Beware! There are law firms who make a good living out of the work generated from those kits – trying to repair the mistakes, interpret & rectify the intended Wills, and fight-off the contested estate claims – all because someone thought it was a good idea to DIY the most important legal document in their life.

The amount of litigation involving kit Wills is growing.

Those Will-kits are like DIY brain surgery. Just because you can try to do it yourself doesn’t mean it’s a good idea.

Doesn’t it make sense to take the effort to get it right? Most people wouldn’t even dream of trying to install their own toilet or air-conditioner, but are being encouraged to have a go at creating the most important legal document you will ever create in your whole life.

But take a good hard look at the fine print in those Will kits – you’ll notice that they all have a disclaimer saying it’s not a substitute for proper legal advice!

So will it be worth anything to you and your family when it really counts?

The problems will only show up after you’re dead and gone. Then it’s your family & loved ones who have to wear the cost and all the delay and heartache to try to fix it all afterwards.

So … are you going to be a ‘bush-lawyer’ and dabble-in estate planning on a DIY basis, even though you haven’t studied the law in this area, haven’t kept up with changes in the law and recent Court decisions?

Maybe you’ve got a Will-kit, and maybe you’ve read a couple of articles on the internet, and you think you’ll have a go to DIY the most important legal document in your life.

But do you realise that the laws about Wills vary from State to State in Australia, and they also change from time to time? Most of the information on the internet is from other countries (especially America) which is not applicable in Australian States, and it tends to be very out of date.

If those mistakes weren’t enough, you should also consider that a Will alone is not the only document you need for an estate plan. Without an Advance Care Directive, power of attorney, trust, or guardianship you may not be providing for your family as you intend.

Contact the oldest law firm on South Australia – Genders and Partners, established 1848 – to learn more about retirement planning, superannuation, estate-planning and estate-administration solutions, by visiting our website today and schedule a free no obligation telephone consultation to find out how we can help you and yours.

Remember – any mistakes you make in your Will won’t become apparent until after you’re dead, and it’s too late for you to fix them. Get proper advice, and do it right.

It is also vitally important that you keep your Will and estate plan up to date – it is not a set-and-forget exercise.

To learn how to protect yourself, your family and your assets, by creating a professionally-made estate plan, claim your FREE 15 minute Telephone Consultation

Rod Genders is a senior Australian lawyer specialising in estate planning and accident compensation. His boutique specialist law firm is one of the oldest and most respected in Australia – visit it at www.genders.com.au .

Rod is also a prolific author and speaker. Some of his articles and books on Wills, Probate, Trusts, Estate Planning, Asset Protection and Retirement Planning may be found at www.estateplanners.net.au

We focus on keeping your estate planning strategy clear and understandable. If you would like to get started on developing your plan or putting it into action, please call us on (08) 8212 7233 or email us at mail@genders.com.au .

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