Why You Should Think Twice Before Using an Online Will Kit
There are many online Will Kits available today. Some are free, while others cost a small fee. Most claim that you can create a Will quickly by downloading a template and filling in the blanks.
Many websites promote online Wills as a way to avoid spending hundreds of dollars on legal fees. While preparing your own Will may appear simple, the reality is often more complicated.
An online Will may be valid in some circumstances. However, a template cannot consider your personal circumstances, family relationships, financial position, or long-term estate planning goals.
The money you save by using a Will Kit may not outweigh the risks of creating a document that does not properly protect your assets or achieve your wishes.
The Importance of Professional Estate Planning Advice
When you prepare an online Will, you generally do not meet with a lawyer who can ask questions about your circumstances. This is one of the biggest limitations of self-prepared legal documents.
A lawyer experienced in succession law can identify issues that may not be obvious to you. They can help you prepare more than just a Will. They can create an estate plan designed around your family, assets and future needs.
The NSW legislation website provides access to current NSW laws relating to wills, estates and succession matters. However, understanding how those laws apply to your personal circumstances often requires professional legal advice.
The following are some important considerations that an experienced estate planning lawyer will address. A basic Will Kit may not consider these issues.
| Estate planning consideration | Why it matters |
|---|---|
| How assets are owned | The way assets are held can determine whether they pass through your estate or directly to another person. |
| Superannuation and death benefits | Superannuation does not always form part of your estate and requires careful planning. |
| Asset protection | Certain structures may help protect inherited assets from future risks. |
| Family provision claims | A person may challenge your estate if they believe they have not received adequate provision. |
| Future incapacity | An estate plan can include arrangements for managing your affairs if you lose capacity. |
Note: The information in this article is general in nature and does not replace legal advice specific to your circumstances.
A Lawyer Prepares an Estate Plan, Not Just a Will
A Will is only one part of a complete estate plan. A lawyer will consider your entire financial and personal situation to ensure your wishes are properly documented.
Estate planning may involve decisions about:
- How your assets will be distributed after your death
- Who should manage your affairs if you lose capacity
- Who should act as guardians or attorneys where appropriate
- How your superannuation and other benefits should be dealt with
- How to protect vulnerable beneficiaries
For example, the way you own property can significantly affect what happens after your death. A lawyer will consider whether your assets are held individually or jointly and explain how this affects your estate plan.
How Jointly Owned Assets Affect Your Will
Many people assume their Will controls all of their assets. This is not always the case.
When property is owned jointly with another person, the surviving owner will generally receive the deceased person’s share through the principle of survivorship.
This means a direction in your Will may not override the ownership structure. For example, if you own a property jointly with another person and your Will leaves your share to someone else, that gift may not take effect.
A lawyer can review your asset ownership and advise whether changes, such as severing a joint tenancy, may better achieve your estate planning goals.
You can learn more about NSW property ownership and land title matters through NSW Government land and property services.
Superannuation and Death Benefits Require Careful Planning
Your superannuation is another important area that many online Will Kits fail to address properly.
Superannuation does not automatically become part of your estate when you die. In many cases, the superannuation trustee decides who receives your death benefit unless you have a valid binding death benefit nomination in place.
A lawyer can help you understand your options and consider whether your superannuation arrangements align with your overall estate plan.
The Australian Taxation Office (ATO) provides information about superannuation and death benefits, including how these payments may be treated for tax purposes.
Preventing a Gift from Failing in Your Will
One common problem with DIY Wills is the risk that a gift to a beneficiary may fail.
This can happen through a legal concept known as ademption. Ademption occurs when a specific asset named in a Will no longer exists when the Will-maker dies.
For example, if your Will leaves a particular property, vehicle or valuable item to a beneficiary, but you sell or dispose of that asset before your death, the beneficiary may not receive anything in its place.
This issue can have a significant impact on beneficiaries, especially where the asset has substantial financial or sentimental value.
The law recognises some exceptions to ademption in certain circumstances. However, careful Will drafting can help reduce the risk of disputes and ensure your wishes are more likely to be followed.
Protecting Your Assets Through Effective Estate Planning
A properly prepared estate plan can help protect your assets and reduce the risk of your inheritance being affected by future circumstances.
A lawyer can advise on strategies to protect assets from unintended outcomes, such as:
- A beneficiary’s relationship breakdown
- Claims from creditors
- Financial difficulties affecting a beneficiary
- The needs of vulnerable beneficiaries
One option that may be considered is a testamentary discretionary trust.
What Is a Testamentary Discretionary Trust?
A testamentary discretionary trust is a trust created through your Will. It begins operating after your death and allows a nominated trustee to manage and distribute assets for the benefit of selected beneficiaries.
This structure can provide greater flexibility than an outright gift because the trustee can consider the circumstances of beneficiaries when making distributions.
| Potential benefit | How it may help |
|---|---|
| Asset protection | May help protect inherited assets in certain circumstances. |
| Flexibility | Allows distributions to be managed according to beneficiaries’ needs. |
| Support for vulnerable beneficiaries | Provides additional control where beneficiaries require assistance managing assets. |
| Tax planning opportunities | May provide potential taxation benefits depending on individual circumstances. |
The Australian Taxation Office provides information about trusts and taxation obligations. You can access further information through the ATO website.
An online Will Kit is unlikely to consider whether a testamentary trust is suitable for your circumstances. It also cannot provide tailored advice about how these structures may affect your estate.
Reducing the Risk of Family Provision Claims
A Will does not always prevent someone from making a claim against an estate.
Under family provision laws, an eligible person may apply to the court if they believe they have not received adequate provision from the deceased person’s estate.
In NSW, family provision claims are governed by the Succession Act 1989 (NSW).
Eligible persons may include:
- A current or former spouse
- A de facto partner
- A child of the deceased person
- A person who was financially dependent on the deceased
- A person who lived in a close personal relationship with the deceased in certain circumstances
The court considers a range of factors when determining whether to make an order, including the applicant’s needs, the size of the estate and the relationship between the applicant and the deceased.
Further information about estate administration and succession matters in NSW is available through NSW Trustee and Guardian.
While family provision claims may be appropriate in some situations, they can create additional stress, delays and costs for families managing an estate.
An experienced estate planning lawyer can identify potential risks and advise on strategies that may reduce the likelihood of future disputes.
Why a Lawyer-Prepared Will Is Worth Considering
Preparing a Will is an important step in protecting your family, assets and future wishes.
A lawyer can ensure your Will meets legal requirements, accurately reflects your intentions and considers issues that a standard online template may overlook.
A professionally prepared estate plan can also be reviewed as your circumstances change, including events such as:
- Marriage or separation
- The birth of children or grandchildren
- Buying or selling significant assets
- Changes to your financial circumstances
- The death or incapacity of a beneficiary or executor
Although you can prepare a valid Will online, there is a risk that a generic template may not address your personal circumstances or achieve the outcome you want.
Meeting with an experienced estate planning lawyer allows you to discuss your circumstances and create a Will that provides greater certainty for your loved ones.
Frequently Asked Questions About Online Will Kits
Are online Will Kits legally valid in NSW?
An online Will Kit may create a legally valid Will if it meets the requirements under NSW law. However, validity does not always mean the Will properly achieves your intentions or protects your estate.
What are the risks of using a DIY Will Kit?
The main risks include incorrect wording, failing to consider complex assets, overlooking tax implications, and increasing the likelihood of disputes after death.
Why should I use a lawyer instead of an online Will?
A lawyer can provide personalised advice, identify risks and prepare an estate plan that considers your assets, family circumstances and long-term goals.
Speak With an Estate Planning Lawyer
If you or someone you know wants more information about preparing a Will, estate planning or protecting assets for the future, contact our team for advice tailored to your circumstances.
You can contact us on (02) 4987 3344 or email [email protected].