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The Word Your Family Should Never See
Probate is Expensive, Time Consuming & Very Public
Did you know that when you die and own real property in California, if that property is not held in a trust, more than likely someone will need to open probate for you your estate will have to go through probate?
For many of my clients the cost to have their estate handled through probate ranges between $26,000 and $56,000! That is a lot of your hard-earned money that will be unnecessarily spent on court fees, attorneys and executors if you don’t have your home in a trust.
Why Does Probate Cost so Much?
You are paying for the court to oversee the distribution of your property. In order to do that you also have to pay an attorney and a representative (executor or administrator) to present information to the court and to administer the estate. The attorney and your representative are paid a percentage of the gross value of what your estate is worth. Any liabilities (money you might owe including your mortgage) is NOT considered when calculating fees based on gross value.
What does that mean? It means a lot of your hard earned money probably is going somewhere other than where you want it to.
Here's an example based on average home prices:
Average Auburn Home Price: $629,500
Cost to Transfer Home through Probate: Approx: $32,550 (Attorneys & Representative Fees Each: $15,590; Court Fees: $1,370)
Cost to Transfer Home Held in a Revocable Trust: Approx: $24
Average Placer County Home Price: $655,000
Cost to Transfer Home through Probate: Approx: $33,500 (Attorneys & Representative Fees Each: $16,100; Court Fees: $1,370)
Cost to Transfer Home Held in a Revocable Trust: Approx: $24
Average Newcastle Home Price: 1,100,00
Cost to Transfer Home through Probate: Approx: $49,370 (Attorneys & Representative Fees Each: $24,000; Court Fees: $1,370)
Cost to Transfer Home Held in a Revocable Trust: Approx: $24
How To Avoid Probate
The simple way to avoid probate is to create an estate plan that includes a revocable trust and to transfer your property (and other assets) into the trust.
The secondary benefit is that your estate plan can take care of more than just avoiding probate. It can give instructions on how to leave your money to minor or adult children giving specific ages and/or purposes in which your Trustee will distribute the funds. It can establish a fund to care for your pets after your death. A properly drafted estate plan can also provide instructions for guardianship of your minor children or grandchildren if you have them.
Won’t a Will Do the Same Thing? Unfortunately, it does NOT. If you own property valued over $166,250 and you have a will it will still go through probate.
Estate Planning is for Everyone
Many people believe estate planning is only for the wealthy, but that is just not true. Everyone has an estate. If you own a home, car, other real estate property, bank accounts, investments, life insurance, furniture, or personal belongings you have an “estate” and need a plan when you’re not able to make decisions. Creating an estate plan ensures that your estate is protected if you become incapacitated or when you pass and that your wishes are carried out through instructions stating who you want to receive your properties, what you want them to receive, and when they are to receive it.
If you haven’t created your own estate plan, the State of California will decide what happens to you, your children, and your property.
Schedule a free phone call below with one of our attorneys to learn more and to ask your most important questions. There is no commitment, just information.
How We Can Help You
Revocable Trusts, Durable Power of Attorney, Advanced Healthcare Directive, Wills, Probate
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