Why Quick and Simple Estate Plan Reviews Don’t Exist

When someone reaches out to an estate planning attorney for a “quick look” at their documents, the request often appears simple. They might have used an online service to create the documents and want to ensure everything is in order. It could also be that they’ve relocated to a new state and are unsure if their plan is still applicable. Alternatively, the documents might be several years old, leading to doubts about their validity. Many individuals anticipate a straightforward yes or no response, ideally during a short phone call or an inexpensive consultation.

However, the truth is that a simple document review in estate planning is a myth. What seems like an easy question actually brings forth a host of legal, financial, and personal factors that necessitate careful analysis and consideration to ensure your plan remains effective for your loved ones.

This article delves into the reasons why reviewing an estate plan demands more thoroughness than one might think, what a comprehensive review entails, and how investing in a review of your plan now can prevent your family from facing significant issues in the future.

The Hidden Complexity Behind Document Reviews

When someone requests an attorney to examine estate planning documents, they are essentially posing multiple interconnected questions that influence their future security and that of their loved ones. Each of these questions necessitates thorough analysis, and neglecting any of them could lead to a legal quagmire later on, which may prove to be both expensive and time-consuming to rectify.

Here are the steps an attorney should follow:

First, assess whether the documents are legally valid according to current laws in your jurisdiction. Laws at the state, federal, and tax levels change often. What was considered legally valid when the documents were created may not align with today’s standards—or may have never been valid in the first place (especially if you drafted the documents yourself). For instance, many banks and brokerage firms will not honor a power of attorney that was signed more than three years ago, and some have even stricter timelines. This means that in the event of your incapacity, your loved ones might not be able to access your assets.

If you have relocated to a different state, it may take a significant amount of an attorney’s time to analyze how you want your estate plan to function and whether it complies with the laws of your new state.

Additionally, tax laws could also affect your estate plan, and the attorney will need to evaluate if your plan should be revised to leverage any applicable tax strategies that are currently available.

In fact, these types of reviews might end up costing more in attorney fees than simply drafting a new plan from the ground up.

Assess if the plan truly achieves what you believe it does. Many individuals think they possess a comprehensive estate plan, yet they often overlook significant gaps. This issue becomes particularly evident when you compile a series of documents and assume you’ve established a complete plan. This is rarely the reality.

Potential gaps in your estate plan might include whether it considers the following:

● What occurs if a primary beneficiary passes away before you – in both your plan documents and beneficiary policies

● Whether minor children are safeguarded from receiving substantial inheritances before they are mature enough to manage money wisely

● Whether the plan takes into account the chance of incapacity, not solely death

● Whether your loved ones are aware of where to locate all your assets, preventing any from being lost

● Whether your loved ones know how to retrieve your passwords

● If you have sufficient insurance to guarantee your loved ones don’t face financial hardship

● If accounts will remain accessible to your loved ones after your passing, ensuring that bills continue to be paid

These are merely a few of the gaps that require attention. This list is not exhaustive.

Evaluate if the documents function together as a unified strategy or if they create discrepancies that might result in costly and lengthy legal disputes.

There are instances where an individual’s will states one thing, their trust indicates another, and their beneficiary designations contradict both.

When such discrepancies arise, families may find themselves in court, with a judge—who is a total stranger to you and your family—determining your true intentions. It’s likely that no one will be satisfied with the result, particularly after spending significant amounts of money and years in litigation.

However, the intricacy doesn’t end there. Even well-crafted documents can fail if a vital step in the planning process is missed.

The MAJOR Issue That Often Goes Unmentioned

Here’s a surprising fact for many: if you’ve established a trust, it won’t function properly unless assets have been correctly transferred into it and beneficiary designations or TOD or POD forms have been accurately completed. In estate planning, we refer to this as “funding,” and it’s where most trust plans fall short (even if you collaborated with a lawyer to draft your legal documents).

You might invest thousands in a will, trust, health care directive, and power of attorney, all presented in an attractive binder, which ultimately becomes useless if your lawyer didn’t implement a process to ensure you updated the titles on your bank accounts, your home, or your investment accounts, and lacks a system to guarantee that new assets are titled correctly when acquired in the future. Moreover, it’s not only about titling; beneficiary designations must also be regularly reviewed and updated. Lastly, the existence of the assets should ideally be inventoried at least once a year.

Evaluating whether an estate plan is adequately funded involves reviewing title documents, account statements, beneficiary designations, and business records. An attorney must ensure that each asset is titled appropriately and that the beneficiary designations are consistent with the overall strategy. This is not a quick task. A thorough review necessitates a detailed analysis of the complete financial landscape.

Imagine this typical situation: a person establishes a trust with specific guidelines on how assets should be distributed among family members, yet their life insurance policy still lists their spouse as the only beneficiary. Upon their passing, the insurance payout goes straight to the spouse, completely bypassing the trust. Consequently, that money might end up with a future spouse or stepchildren instead of the children the plan intended to safeguard. A comprehensive review would have identified this discrepancy while it was still easy to amend.

This illustrates why attorneys cannot provide quick, superficial reviews. Each review demands significant time and resource investment, even if you believe your case is straightforward.

The Risks of Cutting Corners

When someone requests an attorney to “just quickly review” documents, they are seeking legal counsel based on partial information. Attorneys cannot ethically fulfill that request. If an attorney claims a plan is satisfactory after a brief review, and it later emerges that there were critical issues that went unnoticed, you (or your family) might have grounds for a malpractice claim against the attorney. More importantly, your loved ones could face considerable financial repercussions that proper planning could have avoided.

Your professional responsibility to the client necessitates that your attorney either conduct a comprehensive review or refrain from reviewing documents altogether. There is no middle ground that offers you protection. This implies that the attorney must scrutinize documents thoroughly, inquire about your family dynamics and assets, investigate how current laws pertain to your unique situation, and deliver an analysis of their findings. This entire process demands time, expertise, and comes with a cost.

Although the investment in a detailed review may appear higher than anticipated, it is insignificant compared to the challenges you and your loved ones may encounter when insufficient planning fails at the most critical moment. By that time, it will be too late to make corrections.

What to Reasonably Expect

The consultation fee for a detailed review might seem steep until you consider the expenses families incur if a subpar plan collapses. Probate processes often cost thousands of dollars and can extend over a year. Legal disputes among family members regarding ambiguous provisions can run into tens of thousands. The emotional strain of witnessing loved ones argue over an estate while mourning a loss is beyond measure.

If you wish to guarantee that you have a comprehensive plan that benefits you and your loved ones, saves money, keeps them out of court and conflict, and safeguards your minor children in the event you can no longer care for them, you should anticipate spending at least $1,000 for a thorough review of your plan – which includes an inventory of all your assets, what is important to you, and a review of all your documents – regardless of how “simple” you believe your situation to be (in our experience, nearly everyone thinks their circumstances are straightforward, but they rarely are).

Be prepared to fill out a questionnaire or do some “homework” for the attorney prior to your meeting. Also, anticipate that the attorney will dedicate time to prepare for your meeting and will spend hours reviewing your existing documents, financial details, and statements, as well as the status of trust funding. They will meet with you and provide guidance based on their analysis of your current plan. If you wish to make any updates, please note that there will be an extra charge.

How We Support You and Your Loved Ones

A thorough review goes beyond just the documents. It’s about securing peace of mind, ensuring that your loved ones will be taken care of according to your wishes, without facing unnecessary legal issues, family disputes, or financial losses. It’s about safeguarding your assets, providing financial security for your loved ones, ensuring your children are not placed in the care of strangers, and making sure your family knows the steps to take when the time comes.

Schedule a complimentary 15-minute consultation to learn more.

This article is a service of Kristen Wong of Seasons Estate Planning, APC, a Personal Family Lawyer® Firm. We don’t just draft documents; we ensure you make informed and empowered decisions about life and death, for yourself and the people you love. That’s why we offer a Life & Legacy Planning Session™, during which you will get more financially organized than you’ve ever been before and make all the best choices for the people you love. You can begin by calling our office today to schedule a Life & Legacy Planning Session™.

The content is sourced from Personal Family Lawyer® for use by Personal Family Lawyer® firms, a source believed to be providing accurate information. This material was created for educational and informational purposes only and is not intended as ERISA, tax, legal, or investment advice. If you are seeking legal advice specific to your needs, such advice services must be obtained on your own separate from this educational material.