Regardless of whether you make your last will yourself, with the help of an online will maker, or under the supervision of an estate planning attorney, make sure to avoid these 10 Common Mistakes in Will Drafting.
- Writing on or altering your will
- Choosing the wrong witnesses
- Including non-probate assets in your will
- Making dramatic disinheritance statements
- Including a toothless no contest provision
- Making lots of small gifts in your will
- Using a will to leave gifts to many hard-to-find individuals
- Neglecting to prepare for underage beneficiaries
- Failing to warn about improper guardians
- Remaining silent on executor compensation
#1 Writing on or otherwise altering your will
After you've drafted and executed your perfect will, find a safe place to store it and leave it unaltered unless you intend to change it.
While it may sound silly, even something as seemingly innocuous as removing the staples on an executed will can be grounds for objection to probate.
#2 Choosing the wrong witnesses
In order for your will to be legally valid, most states require that you sign in the presence of two adult witnesses and/or a notary public. These people co-sign with you, certifying that you are mentally competent and understand the nature of what you are doing (i.e., creating a binding legal document).
Not all witnesses are created equal, however, and poor choice in witnesses could have significant negative repercussions on your estate plan. If you choose someone who is a beneficiary in your will as one of your witnesses, gifts you make to that person through your will may be impacted. In New York, Texas, and Connecticut, for example, gifts made to such a person are usually capped at the amount that person would have received by the ‘default’ state inheritance laws.
Making poor selections for witnesses is a prevalent mistake among individuals creating their own will with a free online will maker. To make sure that doesn’t happen to you, we dedicate an entire article on how to pick good witnesses and include an extra reminder on all our Just In Case Estates last will and testament documents.
#3 Including operation of law assets (i.e., non-probate assets) in your will
Operation of law assets are assets like joint checking accounts, investment and retirement accounts, life insurance policies, assets held in a trust, and other assets for which the beneficiary is named and therefore known. One of three ways to transfer assets at death, they are highly efficient and effective transfer mechanisms that work outside of the court probate process. Generally, all you need to effectuate the transfer is an original death certificate.
Including operation of law assets in your will is bad practice for a couple reasons. First, you’re taking an asset that could have transferred really easily and requiring it to go through a potentially onerous, expensive, and public probate process. Second, including operation of law assets in your will could lead to disputes and conflict if the beneficiaries designated on the asset do not match the beneficiaries in the will.
Failing to designate beneficiaries for your operation of law assets is blunder of equal magnitude. You lose what could have otherwise been a relatively straightforward, quick distribution in exchange for one bogged down by the additional time and expense of the probate process.
#4 Making overly dramatic statements to disinherit individuals, or not expressly stating that you are disinheriting someone
You may be familiar with one of many movies in which a wealthy benefactor disinherits family members in an over-the-top dramatic scene, recounting a laundry list of reasons those family members aren’t worth a penny in the last will document. Leave those scenes to the movies.
Keep disinheriting statements simple, such as “I explicitly make no financial provisions in my will for my brother, Tommy, or his descendants.”
The keys to a solid disinheriting statement are to (1) explicitly recognize the existence of the person, (2) state in the most simple terms possible your relationship to the person, and (3) state that you are not making any financial provisions for that person.
If you choose to air all your dirty laundry against the disinherited person in your last will, you risk opening up a contest to your will on the grounds that the basis for the disinheritance is untrue.
If you leave a close family member who might inherit under the intestate laws of your state out of your last will but make no explicit statement that you are doing so, the affected individual may contest your will on the grounds that you did not have the capacity to make a valid will, because you failed to recognize a person so close to you.
#5 Including a toothless “no contest” provision
A no contest clause is a provision in a last will that states that a beneficiary who challenges the validity of the will or the amount of the gift made to them and subsequently loses that challenge forfeits the entirety of their gift.
In order for a no contest provision to function as a proper disincentive, you need to give the begrudged beneficiary some skin in the game. Making a gift of $100 to the affected individual when that person thinks he or she should be entitled to $100,000 will not do anything to dissuade him or her from challenging the will. The affected individual has little to lose and much to gain.
If you are uncomfortable or unwilling to give a begrudged beneficiary a healthier parting gift, consider disinheriting the individual outright with a simple statement like the kind in #4 instead.
#6 Making lots of small gifts in your will
The cost of fulfilling a $100 gift in a last will compared to a $100,000 gift is not all that different.
In each case, your executor or attorney needs to handle a fair amount of back-and-forth communication, waivers, and approvals with the beneficiaries, all of which need to be properly recorded and cost money.
Instead of making lots of small gifts in your will, consider this economical way to make small gifts outside of a will.
#7 Using a will to leave bequests to many hard-to-find individuals or non-US citizens
Tracking down hard-to-find individuals and meeting the notice requirements for non-US citizens can run up the time and cost of administering your estate.
Depending on your state’s notice requirements, if you have a foreign beneficiary, you may need that person to go to a US embassy to get a notary stamp, complete and sign additional special documents, or assist with submitting a return receipt or express mail.
If you intend to make gifts to many hard-to-find individuals or non-US citizens, instead of a will consider a revocable living trust to pass assets to these beneficiaries via operation of law, which does not require the same statutory notification provisions of the probate process.
#8 Neglecting to prepare for underage beneficiaries
A beneficiary who is a minor can’t receive property in the same way that an adult beneficiary can. Recognizing the potential for mismanagement of funds by inexperienced children, all 50 states and the District of Columbia have enacted some form of the Uniform Transfer to Minors Act (UTMA).
If a willmaker attempts to make an outright gift to a beneficiary, absent certain other instructions in the will document, state law compels the court to intervene and appoint a competent adult to manage the funds through a guardianship or conservatorship.
Proceedings to establish guardianship and the ongoing management are often contentious and costly, eroding the value of the gift and potentially leading to family disputes. With proper drafting language in the will, these proceedings are easily avoided.
#9 Failing to warn the court on improper guardians for minor children
If your child has another natural parent or close relative who you would not feel comfortable assuming the role of Guardian, you should detail in plain-English your concern about why such person(s) would be an improper choice in your nomination of Guardians.
Maybe this other person has repeatedly failed to provide child support or maintenance, treated the child or other children maliciously, or has had prior legal, substance abuse, or other issues.
At the end of the day, all the Court wants is to do what is in “the best interest of the child.” If you establish a clear and compelling argument about why a ‘default’ guardian would not be a good fit and offer alternative guardian and successor guardian nominations who are in a much better position to serve, the judge will factor that in to the Court’s decision.
#10 Remaining silent on executor compensation
Serving as an executor is a lot of work. States recognize this, and as a default rule, your executor is entitled to seek reasonable compensation for his or her services.
Even if you’d like this default rule to apply, expressing this to be your intent in your will is important because doing so can help mitigate potential conflict among your beneficiaries.
If your executor seeks compensation, that compensation comes off the top of your estate as an expense of administration that reduces the share received by the beneficiaries. That may leave those beneficiaries upset and feeling like the executor is taking advantage of his or her position.
You can make clear your intention with a simple, single sentence like “My executor shall be paid the default compensation for the city and state in which my will is administered,” or “My executor shall be paid $10,000 or 3% of my estate, whichever is higher.”
If you do not want to compensate your executor, you need to state that intent in your will. You should also speak with your executor and make sure that your executor is still willing to serve in that capacity without payment.
Conclusion
You can very easily run into these 10 Common Drafting Mistakes if you choose to create your will by yourself or through a free will form you found off the Internet.
At Just In Case Estates, our questionnaire and documents are purposefully tailored to avoid these pitfalls, so that you can create your plan with confidence.
