Online Wills vs. Estate Planning Lawyer-Drafted Wills: The Real Cost

While online or DIY wills offer convenience and lower upfront costs, they often contain significant errors or oversights that can jeopardize an entire estate.

Set out below are 3 of the key reasons why an online or DIY will is probably too good to be true:

1. Comprehensive Protection

Online or DIY options often give users a false sense of security, leading them to believe their affairs are fully settled. However, most Australians do not realise that a significant portion of their wealth, specifically superannuation and life insurance, is not automatically covered by a will and requires separate legal documentation.

While essential, a will is only one piece of a strategic estate plan. Estate planning lawyers help clients "stress-test" an estate plan to ensure it works in practice. They will address critical “what-ifs,” such as whether a surviving spouse will have immediate cash flow for daily expenses or if there is a sufficient financial cushion to secure the children’s future.

Furthermore, online or DIY wills only dictate what happens after a testator passes away. They fail to include an enduring power of attorney, leaving testators vulnerable if they become incapacitated due to illness or injury. An enduring power of attorney for financial and medical matters is often considered the most important part of an estate plan, as it protects the testator’s interests while they are still alive. Many Australians fall into the trap of making an online will and think that they are covered, but in reality they are still unprotected. 
 

2. Hidden Costs

It is important to distinguish between estate planning lawyers and estate litigation lawyers. While planning lawyers draft the documents to prevent conflict, litigation lawyers resolve disputes in court.

While planning lawyers advise against DIY wills, litigation lawyers often view them as a "goldmine" because they so frequently lead to contested estates. Common issues include:

• Ambiguity: DIY wills often result in confusion or inconsistencies, forcing executors to seek expensive court guidance in order to protect themselves and fulfil their responsibilities.

• Validity: These documents are more likely to be challenged due to procedural irregularities, such as improper signing, witnessing, dating, or missing key clauses.

• Capacity Issues: If a testator loses capacity without an enduring power of attorney in place, family members must apply to a Tribunal or Court to gain authority over their affairs. This is an expensive process that is easily avoided by having the right documentation in place.

Many Australians are surprised to learn that going to court for direction on how to interpret a will or to resolve an estate challenge can cost upwards of $50,000, and is typically paid by the estate, eroding the beneficiaries’ inheritance.

Considering the financial and emotional cost of getting it wrong, it makes the investment in a quality estate plan look cheap!

3. Why One Size Rarely Fits All

Most online platforms assume all individuals have the same circumstances. In reality, every client has a unique backstory, specific needs, and distinct legacy goals.

The primary value of working with an estate planning lawyer is the strategic advice. Those who opt for DIY versions miss out on critical guidance regarding:

• How to ensure superannuation and life insurance go where the testator wants it to go.

• How to help the testator make the right choice for executors, guardians, and attorneys.

• How to minimise the likelihood of a will being challenged.

• How to avoid unnecessary taxes and duties for beneficiaries, ensuring the inheritance goes as far as possible.

• How to protect assets held within trusts and companies.

• How to utilize structures like testamentary discretionary trusts to optimize bankruptcy protection and tax minimisation for loved ones.