Tag Archives: trust

No-Contest Clauses in Wills and Trusts: What You Need to Know

family picIt seems like challenges to wills and trusts have become increasingly common. We often hear news stories about celebrities whose families spend a great deal of time and money fighting high-profile battles over their inheritances.

Many people who contact our law office for estate planning services follow the news. They ask us how to prevent fighting in their own families, ensuring that matters run smoothly as intended. We talk with them about the strategies available to minimize infighting, and the topic of a no-contest clause is often raised.

What Is a No-Contest Clause, Exactly?

A no-contest clause (sometimes called a “penalty clause” or “in terrorem clause” in Latin) is a special provision that can be added to a will or trust. It says that any beneficiary who tries to challenge the document will be eliminated from distribution of assets. In short, if you try to challenge the will, you will be cut out of it. If you try to challenge the trust agreement or the administration of the trust, you won’t receive any funds. Continue reading

3 Ways a Do-It-Yourself Estate Plan Can Fail You

Will PicThere is no question about it; lawyers are not cheap. The concern over costs often drives individuals to try handling certain legal tasks on their own. This is especially true in the realm of estate planning—people will often try a do-it-yourself will or trust based on an online form or book. And while DIY estate planning is absolutely the least expensive option up front, it often causes extensive grief and financial loss down the road.

3 Reasons You Should Have Hired a Lawyer in the First Place

  1. You have a legal question. DIY providers do not and cannot offer legal advice. They are not able to advise you concerning your unique circumstances, goals and needs. And they provide standard documents that cannot take into account every state’s rules regarding estate planning and probate. So even if you choose to work through LegalZoom, Nolo or some other DIY provider, you may end up calling a lawyer anyway and having to pay for consultation time to discuss your questions or concerns.
  2. You made a mistake. One term used incorrectly, one preference incorrectly stated, one detail completely left out, or an improperly executed document—these are just a few of the ways a DIY will can become null and void at worst, or cause extreme family strife in the least. If you are lucky enough to catch the mistake before you pass away, at least you have the chance to fix it. But fixing it will come at a cost, as you will need to work with a lawyer to discuss your intentions, review your will and make revisions.
  3. You need help after you create your documents. You have a trust and a will. But are they effective? Are you certain you have set everything in motion to fund your trust? Are your named beneficiaries consistent across your will, life insurance policies, bank accounts, etc.? If you are unsure how to do all of this, you will need a lawyer to assist you. And the time it takes to catch your lawyer up, and have your lawyer review all of your documents, and then to gain assistance will likely cost you more than had you gone to a lawyer in the first place.

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