I recently took a close look at the phenomenon of do-it-yourself estate planning. Based on what I found and through some soul-searching, I am launching a new business. Stay to the end to see what I have been working on that has distracted me from the usual videos, and I hope it will be worth your time.
The boom in online education, computers, and cell phones over the last decade has contributed to a do-it-yourself spirit leading many, rightly or wrongly, to think they are able to do things for themselves just as well as trained professionals. This is solidly apparent when it comes to estate planning documents. But that begs the question, “Are attorneys competing against AI and do-it-yourself websites?”
Strangely, the answer is actually “no.” And the statistics bear it out.
Statistics-Estate Planning
Here is an amalgamation of statistical studies I have seen over the past few years when it comes to people using attorneys versus online services and do-it-yourself downloads.
- About 28% of all U.S. adults have some sort of estate plan in place.
- About 20-23% of U.S. adults (depending on the studies) have used an attorney to help put together their estate planning documents.
- This means that about 5-8% of adults have created their own estate planning documents, either by drafting their own documents or using an online document creation system
Historically, before the ready availability of online tools to create your own estate plan, the percentage of adults creating an estate plan was still in the 20-23% range. When looking at these numbers logically, it tells me that the 5-8% of adults were never going to use an attorney to handle their estate planning every bit as much as the 72-75% of adults weren’t going to utilize an attorney to create their estate plan.
That’s when it hit me. I was never competing with online estate planning document creation services. This would be like the Gordon Ramsay restaurants saying they were competing with Banquet frozen dinners for people who eat dinner. That’s just not what is happening on a day-to-day basis.
Do It Yourself System?
But there are problems that come with a do-it-yourself system, if it isn’t done the right way. In reviewing the typical resulting issues in my own law firm when reviewing the DIY documents brought to me by prospective clients, I found three recurring issues:
- Not doing it correctly using a tested AI or similar system with good, state-specific documents
- Not executing documents properly
- Not “funding” the plan properly to make it work with the documents created
Let’s take a look at these three problems, and how they can be addressed, and then we’ll get to the announcement.
A Bad System: When I was first starting out, I was renting an office in an executive officer suite, and the receptionist was also a “by the hour” typist for the rental company. She was typing someone else’s revocable living trust into a word processing format so they could reuse it for themselves. I knew who it was for, and I saw enough of the document being typed up to see that it was not going to end well. The person who would be using the trust had a disabled child on disability and Medicaid, and the trust being copied had no such provisions.
There were also estate tax issues back then that a married couple could address with the right language, but those terms were not in the trust being copied. Plus the trust being copied was from Florida and the person who would be using the trust lived in North Carolina. Even the receptionist was shaking her head when she came to all of the parts quoting Florida law.
So how could this situation have been better, even if not perfect? If there were an online system that walked them through the issue of a disabled beneficiary, had state-specific documents, and contained tax-saving language when needed, then at least those issues would be addressed. Plus even some basic education within the system on basic estate planning would help the users realize potential mistakes they could be making. But hiring a typist to just copy someone else’s trust document was going to create a lot more problems than it would solve.
Documents Not Being Signed Correctly: The number of DIY estate planning documents I have reviewed that were not even signed correctly is astounding. It is probably in the neighborhood of 40-50% were defectively signed and/or notarized, and you might as well not even have a document at all.
I once had a married couple who both had PhDs as clients, but they started out asking me to review the documents that “another attorney drew up for them.” It was pretty obvious they did it themselves, considering they excluded each other as executors, and beneficiaries, and left everything to the kids at age 18.
When I reviewed these problems with them, their faces dropped because they had no idea that’s what their documents said. Finally, I got to the last page with signatures. They signed their own Wills, witnessed each other’s Wills (which is not allowed since your own spouse can’t be a witness), and then the second witness spot and notarization were blank. I told them not to worry about the other issues since they didn’t have valid Wills anyway. They ended up being great clients and part of the few who would start out doing it themselves but then obtaining an attorney to create a solid estate plan for them.
So how could this be addressed? Very clear signing instructions, including what witnesses are needed and acceptable as well as whether notarization is required.
Not Funding the Plan Properly: This happens even over time with my own trust planning clients through the law firm, and it becomes a particularly big problem with trust clients when they change investments or advisors without lining up the new asset titles and beneficiary designations to coordinate with the document they are using.
The simplest and most common example is with a Last Will and Testament and age limits for younger beneficiaries. People often don’t understand that if their Will provides that an inheritance is to remain in trust until the beneficiary reaches age 30, but they then list those children as pay-on-death beneficiaries on accounts and life insurance, then the age of inheritance is 18. It’s not what they wanted, but because the Will only covers what is in probate and it was the Will that held the age 30 limitation, bypassing probate with a beneficiary designation means the age limits are meaningless.
So what is the solution? When it comes to DIY estate planning, especially with a revocable living trust, having separate education and guidance on “trust funding” is critical. So having the right educational reference materials, and possibly even a non-legal review with a financial professional, can help a do-it-yourselfer ensure their assets are titled and beneficiary designations named properly.
Attorney vs AI
So now what is the big announcement? Now that I realize that my law office is not competing with the online do-it-yourself systems out there, I have worked with an outside technology company to license their estate document creation system and backed it up with online educational courses and even an asset and account review session to help guide people to properly fund their Trust or Will.
The Estate Patch
This system is The Estate Patch, where people can pick their own estate plan, available at http://www.EstatePatch.com. This is not legal services, which would limit the impact of The Estate Patch to North Carolina where I am personally licensed as an attorney, but it is instead an online tool offered through another company of mine called The Care Assistance Center, LLC to help all U.S. residents do their own estate planning documents. It also includes educational materials so people can understand the plan they pick through the licensed system, as well as through some of the courses and books I have created over the years.
Here’s what people get:
- Access to the document creation system where you can create your own state-specific revocable living trust, last will and testament, power of attorney, and advance health care directive documents without an attorney
- Free updates under your control and direction
- Access to the vault system to store important documents and information
- Access to the Free Trust Course, Trust Funding Course, and other planning topics of interest through The Plain English Attorney®
- Free news subscription to the same weekly e-newsletter sent to my own clients
- A free 30-minute 360 Estate Asset Fortification counseling session with one of our Title and Asset Advisors to help guide you in ensuring your accounts and other assets line up with your written estate plan
You get all of this for your one-year subscription, and you can renew each year at a greatly discounted price. The current price is $999 for a full year, but there is a discount coupon and link that are good through December 31, 2024 that provides 40% off here: https://www.plainenglishattorney.com/offers/Q6sw6Axk?coupon_code=ESTATEPATCH2024. Or you can simply go to http://www.EstatePatch.com and enter the coupon code ESTATEPATCH2024.
And now for the inevitable questions:
- Does this mean that I’m giving up the law office? Absolutely not. There are many more people who want experienced help setting up their own estate plans using an attorney, and they want to be taken through a solid process individually.
- Are the documents as good as the ones used in my law office? I don’t think so, but I do see the documents through the system as “good” and at least “good enough” for most situations. The Estate Patch is being offered as a non-legal service through The Care Assistance Center, LLC and not through any law firm. If you want to make sure that your documents are good enough for your own situation, then please contact an attorney in your state or jurisdiction.
- Will The Estate Patch System include support from your law firm? No, this is a completely separate, non-legal services system geared specifically for the do-it-yourselfers out there who don’t want to work with an attorney. However, our technology partner does have the ability to access attorneys in your state or jurisdiction for an extra fee paid to them to consult with an attorney in their network. If you want to work with an attorney, my law firm can help in North Carolina, or we can provide referrals in other states.
So that’s the big announcement. To continue on with the Gordon Ramsay restaurant comparison, Gordon Ramsay does actually offer its own line of frozen food meals in grocery stores, but that doesn’t mean they are closing down the restaurants to do so. They just want to offer a good experience to the people who can’t or won’t travel to their restaurants or won’t pay a higher price for a meal.
If you have someone who needs an estate plan but keeps hesitating on going to an attorney, then please pass along this information and the website at http://www.EstatePatch.com, and please let them know that the coupon code ESTATEPATCH2024 is good through the end of 2024.