DIY Wills: Tips and Pitfalls

The do-it-yourself will kit is nothing new, but they're making a bit of a comeback lately. Aided by online technology and group coupon sites, the process of creating a will is cheap, cheap, cheap, and easier than ever before.

If you follow all of the instructions properly, and if you make sure the will being prepared is appropriate for the jurisdiction you live in, these can be helpful and "good enough" for a lot of people. The problem, though, is that estate planning can be far more complex than the simple template forms would ever suggest; laws that affect the validity of wills are not at all intuitive and, of course, people are often not all that great about following instructions to the letter – all of which can lead to pretty disastrous results when the time comes to distribute your property.

Here's just one, lesser example: Let's say your spouse dies without a valid will. Believe it or not, it's quite possible that you could find yourself sharing actual ownership of your home – with your toddler or underage child.

DIY Drawbacks

First, make absolutely certain the kit, software or online solution that you're using is specific to your province – wills are governed by provincial law.

Second, follow instructions for executing the will (getting it witnessed and other details), to the letter.

"If you don't have a valid will, then you have no will," says Pat Robinson, partner and head of the Private Client Services at Goodmans LLP. "There are some do-it-yourself will things on the internet. Most of them are pretty good at saying 'here are the things you should address.' The problem is, people aren't all that great at following the instructions. They get 90% of it right. If you've got the wrong 10% wrong, though, you've done all the work for nothing."

Perhaps the biggest drawback to going the DIY route, is the lack of advice, context or explanation. One online kit we tested, required people to fill in forms that included children by name – not the smartest thing to do if you're not done having children. (Robinson says she rarely refers to children and grandchildren by name. Doing so, can mean any children born after the will is made, are inadvertently left out.) (Story continues after the slideshow)

WEIRD WILLS AND FINAL WISHES

Weird Wills and Final Wishes


Other things a lawyer might suggest that you consider:

What happens to the residue of your estate? The kits, says Robinson, "do really well on the specific gifts, but when they get to the residue, that is everything that's left after the payment of debts, funeral expenses and specific gifts, they forget to do something with the rest of it – we call that the residue clause. It's often missing or incomplete."

If you get married, your will is void. If you get divorced, however, your will is still valid, which could mean your estate gets passed on to your ex-spouse, regardless of your new family or marital status.


Your Will Isn't Valid... What Happens Next?

Married couples who own all of their assets jointly almost don't need a will in place, says Robinson. (Note that we said almost.) Having a will naming your spouse is still a good idea, however, for a number of reasons:

Side bank accounts are often abandoned because it costs more than the bank account balance to get those funds released via the courts when someone dies intestate (without a will or without a valid will).

In Ontario, when a person with underage children dies without a will, their spouse will get a preferential share of the estate (currently worth $200,000 but this changes – check with a lawyer) plus half of the remainder. The second half is paid into court to be administered by Ontario's "children's lawyer," an office of the Attorney general, before it is paid out to the children at age 18. If there are two children, the spouse gets a third of the remainder, while the other two-thirds are paid to the children.

"We had a situation where a client's wife died. He had a three-year-old son and a six month old baby. Because the house was in the wife's name, those children became part owners of the house."


Drafting Your Will – Things to Consider

Consider paying your executors. "Everybody, especially family members, thinks you should do it for free," says Robinson, who estimates that even a basic estate can take between 50 and 100 hours to administer. In addition, there can often be a lot of criticism, input, and "backseat executors" around who all have an opinion about how things should be done. "It's a thankless job."

If your executor needs special powers to manage your estate while it is being dealt with, make sure these powers are provided in your will. In one example, it was assumed the executor could mortgage a condo property to pay taxes, then sell the property once tenants had vacated at the end of their lease. Legally speaking, however, executors have a fixed set of powers. "If the power isn't there in the will, they don't have the power to do it." (The condo needed to be sold to pay taxes and the estate paid a penalty.)

"Estate administration can drag on. There's no question about that – it's a big job for the executors," says Robinson. "There's so much paperwork. The reason you want to start with a decent will is to make sure the executors have the best chance of getting things done within a reasonable period of time.


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Kate McCaffery is a freelance writer, editor and former urbanite, now living somewhere in between the lake, the ski hill and some farmer's cow path. Visit mccaffery.ca/kate2.0/ for more information.