The Biggest Mistakes We See in DIY Trusts—And How You Can Help Prevent Them

In today’s digital age, it’s easier than ever for individuals to download estate planning documents online or use a one-size-fits-all platform to create their own trust. While the promise of convenience and cost savings can be tempting, these DIY solutions often lead to major legal headaches—and missed opportunities—for families down the road.

As a trusted advisor, you are often the first line of defense in spotting red flags before they turn into full-blown legal and financial disasters. Here’s a look at the most common issues we encounter in DIY trusts—and how you can help clients avoid them.

1. Funding Is Forgotten

A trust is only as good as what’s placed inside it. Many clients don’t realize that simply creating a trust does not automatically move their assets into it. We frequently see trusts with no real estate, bank accounts, or investments formally retitled—defeating the purpose of avoiding probate or protecting beneficiaries.

How you can help:
Encourage clients to review asset titling with you or with an estate planning attorney. Be especially alert to accounts that still name the estate as a beneficiary or are left outside the trust altogether.

2. Outdated or Incomplete Documents

Many DIY trusts are copied from outdated templates, missing required provisions for modern tax rules, incapacity planning, or digital assets. Worse, some are never signed or notarized properly—rendering them legally invalid.

How you can help:
Ask clients when their trust was last reviewed and whether it has been signed and funded properly. If they hesitate, it may be time for a professional review. A quick referral now can prevent expensive litigation later.

3. Wrong Trustees or No Backups

Naming the wrong trustee—or failing to name backups—can derail the administration process. We’ve seen DIY trusts that name a deceased person as trustee, or worse, a person with no understanding of fiduciary duties or conflict management.

How you can help:
Talk to clients about who they’ve named in these critical roles. Ask whether they’ve discussed those responsibilities with their chosen agents. If not, that’s a good entry point to explore the strength of their overall plan.

4. Poor Coordination with Financial and Tax Planning

DIY trusts often exist in a vacuum. They don’t account for a client’s larger financial picture, tax strategy, or retirement goals. We’ve seen plans that unintentionally trigger tax consequences, expose assets to creditors, or conflict with business succession plans.

How you can help:
As part of a client’s advisory team, you bring the full picture into focus. A coordinated plan—between legal, financial, and tax professionals—ensures the trust actually supports the client’s long-term goals.

5. No Communication or Education for Beneficiaries

Even when the documents are “technically” sound, we frequently see DIY plans fall apart because families were never informed or prepared. This leads to confusion, conflict, and sometimes contested estates.

How you can help:
Encourage clients to treat estate planning as an ongoing conversation, not a one-time transaction. We often recommend family meetings or “soft landings” with successor trustees to review the plan and their role in it.

Final Thoughts: The Value of Professional Guidance

DIY estate planning might seem harmless, but the consequences of a poorly constructed trust can be costly—both emotionally and financially. As a professional advisor, your influence matters. By asking the right questions and partnering with experienced estate planning counsel, you help clients build plans that actually work when it matters most.

If you ever spot something that seems “off” in a client’s plan—or want to offer them a complimentary review—we’re always here to collaborate.