I last made out my will 25 years ago and think that it should be reviewed and updated. I'm considering using some of the online forms (especially those by NOLO, which has what seems to be a comprehensive program ndividualized for each state) to make out a will, living will, and a financial and health power of attorney. My situation is fairly straightforward (married, two grown kids, money to be left to surviving spouse and then to kids equally). What are your thoughts on doing this with online forms rather than having attorneys doing this for so much more money? Is there a need in NJ for including some clauses related to tax treatment of estate and if so does this argue for use of attorneys? Thanks for whatever help you can provide.
OT: Need advice on making out a will
- Thread starter KShore
- Start date
My wife and I were very happy with Legalzoom recently fwiw. Quick, cheap, accessible for future changes, detailed.
I am not an attorney but the first thing I question is whether you need a marital trust in your wills to exempt the first 675k in assets from N.J. taxes. If so, you have to have things titled correctly. The tax saved here alone may be in the high thousands in N.J. when the second spouse dies. I think a $1200 bill from an attorney every twenty five years may be the way to go. Good luck. $$$$
This post was edited on 4/13 9:54 PM by dollarbill
This post was edited on 4/13 9:54 PM by dollarbill
Folks, unless you have absolutely no assets, a will must be drafted by a competent (if not certified) trust and estate attorney with full collaboration from your accountant. The cost of a will reviewed by such professionals could run as low as $2,000 (once again depending on your assets and type.)
I strongly advice against LegalZoom and any other online process. At a minimum, run your will draft (if self drafted) by an accountant....
I strongly advice against LegalZoom and any other online process. At a minimum, run your will draft (if self drafted) by an accountant....
Ruroman is right...im about to go through this process
If you care what happens to your assets on your passing, want to minimize tax consequences, and/or prevent others that you don't want and/or jitneys your assets to go to...you get a lawyer
If your estate is or will grow to 7 digits...get a lawyer....and probably a LLM
If you care what happens to your assets on your passing, want to minimize tax consequences, and/or prevent others that you don't want and/or jitneys your assets to go to...you get a lawyer
If your estate is or will grow to 7 digits...get a lawyer....and probably a LLM
Agree with Ruroman and Scarlet Shack. Unless you are totally strapped for cash, why not pay a competent professional to take care of such an important financial decision for your family and loved ones? Would you do your own plumbing or wiring in your house to save a few bucks, or call a plumber or electrician?
KShore,
This is what I do for a living. I will tell you that those forms are not terrible these days, but they shouldn't be used if you have a single complicating factor. Complicating factors include:
1) If you have assets over $675K, there are estate taxes in NJ. (make sure you include value of house, retirement accounts, life insurance... EVERYTHING)
2) If you are in a second marriage
3) If you have more money than you would want to give your kids this second. I know I wouldn't want to leave even $100,000 to an 18 year old.
4) If you have property in more than one jurisdiction (property in 2+ states or foreign accounts)
5) If you have a special needs child or a kid with drug/alcohol problems
6) if you have a kid in a bad marriage
7) If you have any special requests on where you wish to leave your money (including if you wish to leave a part of your estate to a charity or a niece/nephew)
The online forms can't handle any of that. Remember, you are not paying for the documents, you are paying for the advise. Usually anyone with a $1M plus can save their kids at least $30K with some decent planning. People who use them really shouldn't have much money and should be prepared to leave everything outright to responsible adult children. They don't include trust/tax planning. Also, as someone else said, titling of assets is very important... it supersedes your Will.
This is what I do for a living. I will tell you that those forms are not terrible these days, but they shouldn't be used if you have a single complicating factor. Complicating factors include:
1) If you have assets over $675K, there are estate taxes in NJ. (make sure you include value of house, retirement accounts, life insurance... EVERYTHING)
2) If you are in a second marriage
3) If you have more money than you would want to give your kids this second. I know I wouldn't want to leave even $100,000 to an 18 year old.
4) If you have property in more than one jurisdiction (property in 2+ states or foreign accounts)
5) If you have a special needs child or a kid with drug/alcohol problems
6) if you have a kid in a bad marriage
7) If you have any special requests on where you wish to leave your money (including if you wish to leave a part of your estate to a charity or a niece/nephew)
The online forms can't handle any of that. Remember, you are not paying for the documents, you are paying for the advise. Usually anyone with a $1M plus can save their kids at least $30K with some decent planning. People who use them really shouldn't have much money and should be prepared to leave everything outright to responsible adult children. They don't include trust/tax planning. Also, as someone else said, titling of assets is very important... it supersedes your Will.
Not to nitpick, but you think you were very happy with it. The problem is that until you are either dead, or a professional reviews it, you may not really know. I am a trust and estate attorney, and estate planning is probably 75% of my practice. I have had a lot of people come in with docs they prepared on Legal Zoom. Most of them are fine. The forms are really not bad at all, and as long as you take your time and have a little bit of a working knowledge of estate planning, you should be okay. That said, I have seen people who seriously messed up their planning with Legal Zoom, including one couple recently who had wills that inadvertently disinherited their children, and left everything to their grandkids. They were pretty happy they came to see a lawyer.
If you do not have a basic understanding of how wills should be drafted (i.e. if you have never had a Will professionally drafted and have never read a will before) I would not recommend legal zoom, because you cannot give yourself a "sanity check." As mentioned above, I think it is also inadvisable if you have a tax issue (either spouse is over $675k net worth, including fair market value of the house and the death benefit of any life insurance), if it is a second marriage, or if any of your heirs are special needs. A lawyer should also be used if you want to something creative (i.e. not leaving everything to the kids equally).
If you want to have a quick call to discuss your needs, let me know, and I will post contact information. I would be happy to help -- regardless of whether you ultimately decided to hire an attorney or not.
Spot on. And the niece/nephew (and grandchildren per OC's also spot on post) part of #7 brings out the fact that New Jersey also has an Inheritance Tax that can produce some nasty and expensive surprises if it's not considered.
This post was edited on 4/14 9:31 AM by mdk01
Right on! And may I add a few other concerns: (1) Having an estate attorney coordinate the beneficiary designations with the provisions of your Will, making sure that they do not conflict; (2) Having the beneficiary designations on your life insurance and retirement accounts reflect the trust provisions in your Will for minor children; and (3) Retitling the assets between the spouses so that each spouse will have sufficient assets to take advantage of the marital trusts that should be in your Wills;
Perhaps the people who are trusts and estates lawyers might also be willing to provide advice on what you should do before you go to them. The lawyer we worked with had a checklist, more or less. Here are some of the things I remember, but I'm sure there are more:
1. What's going to your family (and who gets what); anything that's going to people who aren't in your family; what's going to charity, which charities and how much.
2. If there are children under 18, who will take care of them if both parents die; who will be responsible for handling the money or other assets they get (maybe not the same people) and for how long.
3. Same question as to who will handle money or other assets going to minors who aren't your children.
4. Provisions for pets and their care.
5. Are there specific objects or categories of things - like your mother's engagement ring or pearl necklace, family photos, or the ugly chair that you promised to your fraternity brother - that need to be mentioned. Even if you've said for years that your daughter gets the pearls, she's not guaranteed to get them unless it's in the will.
6. For advanced medical directives and powers of attorney, what exactly do you want to do? For instance, when does a power of attorney kick in and exactly what power does it give the person who holds it? (BTW, even with the best planning, sometimes the people who get the medical power of attorney have to guess because there can be conflicts, but the more specific you are, the better.)
Oh, and remember to ask people before you make them trustees or executors. Nobody likes that kind of surprise, and the last thing you want is someone turning it down when it's too late for you to do anything about it.
1. What's going to your family (and who gets what); anything that's going to people who aren't in your family; what's going to charity, which charities and how much.
2. If there are children under 18, who will take care of them if both parents die; who will be responsible for handling the money or other assets they get (maybe not the same people) and for how long.
3. Same question as to who will handle money or other assets going to minors who aren't your children.
4. Provisions for pets and their care.
5. Are there specific objects or categories of things - like your mother's engagement ring or pearl necklace, family photos, or the ugly chair that you promised to your fraternity brother - that need to be mentioned. Even if you've said for years that your daughter gets the pearls, she's not guaranteed to get them unless it's in the will.
6. For advanced medical directives and powers of attorney, what exactly do you want to do? For instance, when does a power of attorney kick in and exactly what power does it give the person who holds it? (BTW, even with the best planning, sometimes the people who get the medical power of attorney have to guess because there can be conflicts, but the more specific you are, the better.)
Oh, and remember to ask people before you make them trustees or executors. Nobody likes that kind of surprise, and the last thing you want is someone turning it down when it's too late for you to do anything about it.
As someone who is starting this process as well does anyone have any recommendations for who to talk to in the JC area? I have a few complicating factors so I always knew that online forms were not going to be the way to go.
BeKnighted,
To be honest, I normally don't ask my clients to do very much before coming to see me other than to prepare a detailed list of financials and information about immediate family. I often find that if I ask too many questions before the meeting, the great becomes the enemy of the good. In other words, people don't want to come in at all until everything, in their minds, is perfect.
If you meet with someone who specializes in this area, they will have a long sit-down with you and go over all your choices. I ask my clients for their "gut reaction" to many of my questions. For example, who would you want your Executors/Trustees/Guardians to be. Who would be their backups? What happens if your entire family passes in a disaster? Most people honestly don't want to give this a lot of thought.
When I meet with people, I explain the roles each and what their options are. A lot of clients don't know that you can have co-trustees or a corporate trustee. A lot of people don't understand that you can space out when your kids receive their money. Plus, many times what a person thinks they want is not actually want they really need.
After getting a client's gut reaction and creating a default plan, I give them 2 weeks to think about everything in case they wish to tinker with their distribution scheme or who is in charge. I have found this to work far better, and the clients who insist on a list of questions ahead of time are the same ones who never actually come in to sign their paperwork.
Probably the biggest reason to not send out the questions ahead of time is because I never know what to ask until I meet with the client. Often a throwaway comment by a client will lead to a dramatic reveal that utterly changes their entire plan. For example, I met with someone last year who seemed to have a very simple situation. She was unmarried and had no kids. She wanted everything to go to a sister. I happened to ask if the sister would be OK handling the substantial sum of money. Well, it turns out she was receiving Medicaid... you better believe that things like that are important to mention. It can dramatically change the plan.
Also - with the Health Care Powers of Attorney, I'm a big believer in not giving as much specificity. Medicine is constantly changing. It is better to name people you trust who will understand your wishes.
RuRoman[/URL] and Shack are correct -
If you have over 675K in assets you may want to opt for a personal attorney as you may be leaving money on the table. Legal Zoom is good for a young couple with barely any assets. Most people in their 50's and 60's should have a net worth north of 675K (with house).
Legal Zoom is esentially a database of forms and that is it.
If you have over 675K in assets you may want to opt for a personal attorney as you may be leaving money on the table. Legal Zoom is good for a young couple with barely any assets. Most people in their 50's and 60's should have a net worth north of 675K (with house).
Legal Zoom is esentially a database of forms and that is it.
This is probably one of the most eye opening posts on this board for me anyway. I realize what an idiot I am for constantly putting this off. Now I need to find an attorney. Anyone have any recommendations for Atlantic or Cape May counties?
Thanks. Maybe our lawyer thought we were organized and knew what we were doing (which was not actually the case).
This thread is basically the exact opposite of the "use a real financial planner instead of index funds" threads we've had here recently. Actual reasons provided for why going with a professional is better than going at things on your own. Some really good info here.
My pleasure. FYI, when looking for a good estate planning attorney, try to use one that focuses on this type of work. It's really hard to stay up on this unless you do it all the time. Also, it really takes us about 3-5 years before we become decent at drafting your documents and coordinating them with your life insurance and retirement accounts. If you have a fair sum of money (more than $675K), I recommend finding someone with a Masters in Tax (LLM). Finally, be careful about someone who forces everyone into the same plan (such as revocable living trusts).
Sorry, I don't really know anyone well enough in Jersey City or Cape May County to make a recommendation.
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