Evaluating a Codicil vs. a New Will for your Estate Planning Strategy

When an estate planning strategy needs updating, there’s always one key question. Should an entire will be written and executed, or is a simple amendment sufficient?

An amendment to a will, in lawyer talk, is a codicil. It’s an important question, and not one to be taken lightly.

There are no guidelines or restrictions in the law regarding the use of a codicil instead of a new will. The decision is a matter of the judgment of the attorney and testator (the person who signed the will).

The advantage of a codicil is you avoid the cost of redoing the entire will, the change is made faster, and there could be a reduced probability of an inadvertent drafting error.

Evaluating a Codicil vs. a New Will: Potential Advantages

Even so, I believe in most cases the potential advantages of a codicil are outweighed by the potential disadvantages. Consider the following possibilities.

It’s possible for a codicil to become separated from the main will. The executor then follows only the will unless he knows the codicil exists. The search for the codicil could be time-consuming and even futile.

When a codicil is drafted, the full implications for the rest of the will or inconsistencies with it could be overlooked. A careful, experienced estate planning specialist will take the time to look for and avoid these problems (possibly eliminating cost savings), but I think most professionals agree the problems are less likely to occur when a new will is prepared instead of a codicil.

Having two (or more) documents instead of one unified will can make it easier for someone to challenge the terms. It’s easier to claim, for example, that you were mentally competent at the time the main will was executed but not sometime later when the codicil was prepared. The existence of the codicil also can make it easier to argue inconsistencies between the two documents.

Evaluating a Codicil vs. a New Will to Account for Disgruntled Heirs

Using a codicil gives a disgruntled heir an additional opportunity to argue that all the legal formalities weren’t followed. Having one document means the formalities for only one need to be proved.

A codicil is appropriate only for a simple change, such as changing the executor or personal representative or adding or deleting a relatively small gift. For example, you might have included a small, specific bequest to a friend or relative as a symbolic gesture to let them know you remember them and they were special to you. Then, the person might pass away before you. So, you prepare a codicil to eliminate the bequest.

The opposite also might occur. You might have decided to make a personal bequest to someone because you are closer to them now. Or maybe they expressed an appreciation for a personal item of yours and you want them to have it. A codicil is appropriate for those changes because they are simple and the items aren’t a significant part of your estate.

Evaluating a Codicil vs. a New Will to Name and Address Changes

A codicil also can be appropriate when a person’s name has changed or you included an address in the will and that address has changed.

But more significant changes should be made through a new will. Keep in mind that what seems like a small change to you might not be taken that way by the people involved. Generally, adding or deleting a beneficiary or changing the amount someone inherits should be considered a significant change that warrants a new version of the will. At a minimum, that makes it easier for your estate to defend the will by showing that you took the matter seriously and deliberated over it.

When there have been marriages, divorces, or births in your family, that’s an important change. It merits a new will and not merely a codicil. When your net worth has increased (or decreased) substantially or you acquired or disposed of significant assets that were mentioned in the will, those changes also should be reflected in a new will instead of a codicil.

Evaluating a Codicil vs. a New Will for Many Changes

The number of changes being made also is a key consideration. Each of the changes might be small and, by itself, merit only a codicil. But if you haven’t updated the will for a while and are making six, seven, eight, or more of these simple changes, then it’s better to rewrite the will. Or if you already added a couple of codicils over the years and another change is required, consider putting all the changes in a new will instead of a series of codicil.

Another good reason to redraft a will instead of adding a codicil is to keep the original decision private. For example, you might have disinherited someone in the original will but have reconciled with him or her. If you simply add the person as a beneficiary in a codicil, everyone will know they originally were disinherited because a will is a public document that is recorded in the local courthouse and available for inspection.

Evaluating a Codicil vs. a New Will that Can Be Changed Easily

Keep in mind that wills and other legal documents are prepared by lawyers using word processing and related computer software often specifically developed to use for drafting wills. As a result, it shouldn’t take much time or cost a lot of money to draft a new will. It’s not like the old days when a will had to be drafted by hand or prepared in a typewriter.

A codicil requires all the formalities of the will itself. That means in most states it must be signed in front of at least two witnesses and perhaps a notary public. So, you won’t be avoiding those formalities by opting for a codicil instead of a new will.

Here are some general rules. Consider a codicil when you change the executor or a guardian. A codicil also might be appropriate when you add a new grandchild to bequests for already-existing grandchildren. A codicil also might be appropriate when you want to increase a bequest to a beneficiary who’s already in the will, though that depends on how much the bequest is increased and how it affects the other beneficiaries.

But a new will is appropriate when you change or create a trust, disinherit a beneficiary, or already have one or more codicils. A new will also should be favored when you’re concerned about privacy.