07 Jul Why are Wills a Rip-Off?
Have you ever tried to get a will or a trust from a stationary store to try and save money? Or maybe you know someone who has. If you have, what you probably found was the difficulty of trying to decipher the legal language. What you also probably didn’t know is that most of those “generic” boilerplate templates are NOT state specific.
Learn more about the benefits of a living trust.
So what do you do? Many people have found success by using an attorney or a prepaid legal service. But there are a few things you should know before you implement a will to ensure you don’t get ripped-off. This post will tell you what you need to know to make sure you select a will or trust that will let you successfully avoid probate.
First of all, a will is only necessary if your gross estate is more than $150,000 or if you own real estate over $50,000. If it is less than that, all your heirs will need is 40- 90 days and a Small Estate Affidavit. If it’s over that you may want to consider a living trust over a will.
Find out more about our living trust services.
A will is a rip-off because it GUARANTEES your heirs will go through probate. A will is a simple statement of your wishes. A will has to be validated by the probate court before it can be used to dispose of assets. In California there are “statutory fees”.
Here are the current rates:
- 4% of the first $100,000 of the gross value of the probate estate
- 3% of the next $100,000
- 2% of the next $800,000
- 1% of the next $9 million
- .5% of the next $15 million
So you can fees add up. This excludes probate referee fees See the Probate Referees Fee Schedule here, appraisal fees, court costs etc.
When seeking legal counsel keep in mind if an attorney recommends a will it’s probably because he expects to be the attorney handling you estate in probate. So why would he do living trust for $800-$1500 when he can get $10,000-$20,000 or more in probate court?
Other draw backs are that ANYONE can contest a will in court. It becomes public record and there are scam artists that make a living off of just probate cases. Also, probate court processes can take a year or more. Wills also do not have special instructions for the management of you personally in the event of incapacity. For this situation you’ll need a power of attorney.
A living trust will include powers of attorney, avoid probate and give you and your heirs’ control. In addition using prepaid attorney for the trust controls your costs. They do not get paid by the hour and therefore get paid the same fee whether they spend 5 minutes or 5 hours on your trust. Legal fees are going up not down. Every day you wait costs you money.
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