However much effort you put into creating your estate plan, your personal investment may end up wasted if family members challenge it. Will contests are one of the most expensive and frustrating types of probate litigation. They involve family members or prospective beneficiaries challenging the documents left behind when someone dies.
Will contests can destroy relationships and consume thousands of dollars in estate assets. If one of the two situations below applies to you, then you may need to consider adding a no-contest or penalty clause to your estate plan to prevent challenges. Such a clause will disinherit those who unnecessarily contest your will. When are such clauses a good inclusion in your estate plan?
You have substantial assets
Do you own multiple pieces of real estate or a small business? Do you have a six or seven-figure balance in your investment account? The more valuable your assets are, the more likely it is that people will fight over them. You may want to add a no-contest clause to prevent family members from undermining your last wishes — especially if your wishes include leaving assets for those who are not in your immediate family or to non-profit organizations.
Your loved ones don’t get along
Despite your best efforts to raise healthy, happy children, your kids might hate one another now that they are adults. On the other hand, your children may have great relationships with each other but a terrible relationship with their stepparent, your current spouse. When there are major tensions in your family, you may have to prevent that dynamic from leading to probate litigation by adding a no-contest clause to your estate plan.
Including the right terms when planning your estate can help reduce later conflicts and maximize what you pass to your loved ones.