Pros & Cons of Your Estate Planning Options
Estate planning is very important as your final act of stewardship. However, it’s often one of the most neglected aspects of financial planning. Even after discussing the need for estate planning documents as a part of our comprehensive financial plan, many of our clients still take a year or two to actually get them done.
For many people, thinking about their eventual death or possible incapacitation is something they would like to avoid. Then, there is the need to make difficult decisions for an unknown future time, such as who to list as the guardian for your minor children. Finally, what is the best way to actually create estate planning documents?
Today we will help you tackle that last question. There are three main ways to get estate planning documents in place so we are going to take a look at the pros and cons of each.
Local Estate Planning Attorney
The best, and safest, option is to work with a local estate planning attorney to draft your estate planning documents. They can customize your documents to your unique situation and desires. Many estate attorneys will also provide guidance or assistance in implementing your estate plan, such as funding a trust.
The challenge is that this option also carries the biggest price tag. Even for an uncomplicated situation, it can cost up to several thousand dollars to have an attorney draft individualized documents for you. It can also require a greater time commitment if you have multiple in-person meetings to develop and sign your documents.
Group Legal Plan
Some employers offer legal services as an employee benefit. This can be a great way to access an attorney for personalized help at a lower or no fee at all. We often recommend that people check to see if they have access to a legal benefit as their first step toward drafting estate documents.
While utilizing a group legal plan is usually much more affordable than going directly to an attorney, you don’t have as many options. Usually, you have a limited list of attorneys to choose from so you don’t have as many choices regarding quality, availability, or even personality compatibility with your attorney.
Online Service or Template
The internet has brought a more affordable option for drafting estate documents than working directly with an attorney. There are a number of online services, such as Trust & Will, LegalZoom, RocketLawyer, etc. that assist people with drafting estate documents. Some are just templates that you can fill in and others offer a review of your documents by an estate attorney. This is the fastest option available since you do it on your own instead of waiting to schedule a meeting with an attorney.
Of course, there are downsides to the DIY online options. The biggest is the lack of customizability and state-specific knowledge that you get when working directly with an attorney. You also face a greater risk of making small mistakes that can challenge the legality and usefulness of your documents. One of the most common problems is that after printing out their documents, people forget to follow through and have them notarized.
Which One Is Best?
Which option is best is specific to your situation. Whenever you have a complicated family situation such as a blended family or the desire to exclude certain family members, then you really should work with an attorney who can customize your documents and ensure that they are legally sound and can withstand being contested. If you live in a state where probate is burdensome, you may want to work with an attorney to increase your chances of avoiding probate.
In cases where working with an attorney is cost-prohibitive, then using an online service may be better than having nothing at all, though that depends on the quality of the service. Online services are best suited for simple situations where your primary beneficiary is your spouse and your contingent beneficiaries are your children.
At Guide Financial Planning, we are not attorneys. This article is not legal advice. Rather, our goal is to educate you on the pros and cons of your various estate planning options since this is something we get asked almost every single time we present a financial plan to a client. While we do not draft estate planning documents, we do create financial plans that discuss which estate documents you should get in place. If you’re interested in learning more about working with us to build a financial plan, schedule a free introductory call here.
About Guide Financial Planning
Guide Financial Planning is led by founder Ben Wacek, who is a Christian fee-only Certified Financial Planner® and Certified Kingdom Advisor®. He has a passion for helping people of all income levels make wise financial decisions and steward their resources from an eternal perspective using Biblical principles. Based in Minneapolis, MN, he works with clients both locally and virtually throughout the country and abroad. You can follow the links to learn more about Guide Financial Planning and our team and the services we offer.