Iowa residents who are considering using a do-it-yourself estate plan to save money should be aware that it could be costlier in the long run. DIY forms often do not have the necessary information to deal with anything out of the ordinary, and even what appear to be simple estates can raise issues.
This was the case for a family in Florida. A woman created a will using DIY forms and listed all of her assets, saying they should all go to her sister. She named her brother as second beneficiary in case she outlived her sister. The woman’s sister did die first, and the woman inherited all of her assets. However, she did not update her will. Most wills contain what is known as a residuary clause or another type of clause that addresses what happens to any property not specifically listed. The DIY form did not include this, so the woman’s will did not address it.
As a result, two nieces stepped forward to claim a portion of the estate. The brother ended up in litigation with the nieces that went to the Florida Supreme Court. Although it appeared that the woman did not intend the nieces to inherit anything, the court could not infer that, and the nieces received some assets.
There are many different strategies that could be used to address fairly common issues in estate planning that DIY forms might not cover. For example, people in second marriages who have children from a previous one may want to make sure that some assets go to those children and not just to the new spouse and the new spouse’s children. Trust can be created to protect estates from various threats, including creditors, divorce or the irresponsibility of the beneficiary.