While planning your estate, you learn about probate and how it may tie up assets. To make your beneficiaries’ lives easier, you want to cover probate costs. What should you budget for?
U.S. News & World Report explains how much probate costs and how to avoid the legal process. Even if you cannot avoid probate, you could take steps to reduce its financial toll on your estate.
The probate process
Expect to pay between 5% and 10% in administrative and legal fees for the court to probate your estate. Some parties pay as much as 20% for probate. You must also consider attorney fees, which depend on geographic area and the size of your estate. You must also pay your estate executor for tending to the role’s responsibilities, which include securing a probate bond and filing documents with the court.
If your beneficiaries argue or someone tries to gain control of estate property, that increases probate costs. The same applies if your estate representative tries to take assets from beneficiaries. Sometimes, decedents become involved in legal matters before their deaths. When that happens, their estate could become a successor in interest, which may result in high litigation fees that affect probate.
Saving money on probate
Understandably, you may want many (or all) of your assets to bypass probate. You may accomplish this by creating a revocable living trust. The estate planning document explains how you want the trust and its property administered. You may also use a survivorship feature to title real estate property to avoid probate.
You have more options than you may realize for bypassing probate. By learning more about those options, you make estate planning choices you feel comfortable with.