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Can Paperless Wills Encourage Estate Planning?

hand signing a legal document with a ballpoint pen

Precise statistics vary, but by most measures well over half of American adults have not written a will.

Gallup put the number around 56 percent last year; Harris Poll said it was 64 percent in 2015. Princeton Survey Research Associates pinned it at 58 percent this January. From my professional experience, I can add that many of those with wills have let the documents become so old and outdated that they might well be horrified upon rereading them to see what they contain.

There are a lot of reasons Americans don’t write – or update – their wills. One that is often cited is that people just don’t like to think about their own demise. Another I have often seen is that making the decisions that go into a will is often difficult and highly emotional; coordinating those decisions with a spouse’s preferences can be even more so.

These obstacles do not go away if the mechanical process of writing a will, or the medium on which the will is recorded, becomes more up to date. The only problem such changes solve is that of inconvenience. But even so, such updates are on the way.

Electronic wills are one of the latest developments on the estate planning front. Nevada has already authorized them, and lawmakers in Florida and elsewhere are considering following suit. Courts in Ohio have ruled that such wills can be valid, even in the absence of a specific legal authority. I believe other states’ courts could easily reach similar conclusions.

Of course, many electronic tools already exist to help individuals draft estate planning documents. Especially for individuals whose needs are relatively simple, available software and other electronic resources can simplify the drafting process. And in 2017 it is the rare will that is handwritten or composed on a typewriter. Most legal documents start out as computer files.

But none of these things cover what estate planning and legal professionals mean when they refer to an “electronic will.” Today, in most states, wills must still be physically printed and signed, no matter how they are composed. Electronic wills, on the other hand, would eliminate this final analog step. Testators will be able to electronically sign such wills using methods specified by law; for instance, in Nevada, such wills must be authenticated through unique authentication processes such as retinal scans, voice recognition or a digital signature. In addition, electronic wills can be stored in the cloud and on hard drives. They will thus eliminate the need for physical documents outright.

Nevada enacted its statute in 2001, but electronic wills remain rare today. As Gokalp Gurer, the senior articles editor of the UC Davis Law Review, observed last year, “attorneys love paper.” Many in the estate planning profession remain suspicious of electronic wills, and so far state lawmakers have not been in a hurry to embrace them either. But our world is increasingly paperless, and it is only a matter of time before electronic wills become a widespread option nationwide.

In truth, such wills have both advantages and disadvantages. They will be easier to store, easier to find and easier to share with close family members or other individuals who might need to be informed. But without effective safeguards, they could also be easier to forge or alter. It may become more difficult, too, for a court presented with multiple wills to definitively determine which was executed most recently.

These problems are not insurmountable, however. We make all sorts of contracts electronically these days. Many court systems have gone largely or entirely paperless. We already have systems in place to safeguard against forgery, which can be made more robust if necessary in the case of electronic wills.

Additionally, state lawmakers can specify witness and other provisions necessary to make a will “self-proving,” whether electronic or otherwise. A self-proving will is one whose validity is accepted on its face. Typically this requires signatures by two disinterested witnesses, who can attest that the testator was present and mentally competent when the will was executed, along with that of a notary, who will verify the testator’s identity. These provisions could transfer to an electronic will in a variety of ways. In the proposed Florida legislation, for instance, any valid electronic will must be electronically signed by the testator in the presence of two witnesses, who must also e-sign the document. To be self-proving, however, the document will also need to be notarized.

Moreover, for some people with relatively complex financial or personal situations, a good will requires expert guidance in order to achieve the desired results without triggering unintended, adverse financial consequences. Storing a will in a PDF format will not change this fact one bit.

The bottom line is that, as we move toward a paperless society, physical wills are likely to become an anachronism. It would be great if this change also encouraged more people to make informed decisions about their estate – but that might be asking too much.

Larry M. Elkin is the founder and president of Palisades Hudson, and is based out of Palisades Hudson’s Fort Lauderdale, Florida headquarters. He wrote several of the chapters in the firm’s recently updated book, Looking Ahead: Life, Family, Wealth and Business After 55. His contributions include Chapter 1, “Looking Ahead When Youth Is Behind Us,” and Chapter 4, “The Family Business.” Larry was also among the authors of the firm’s book The High Achiever’s Guide To Wealth.

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