Different costs are associated with having a Trust and probating a Will.
Trusts and Wills perform similar functions like allowing you to designate who you want to leave your belongings and assets to after you die. However, they achieve this in different ways and at different costs to you and your loved ones. In broad strokes, both documents do require time and money. While you bear the cost of drafting a Trust, when probating a Will, they will be paid by your family.
The costs of probating a Will.
A Will sets forth your wishes for how you would like to distribute your property. A Will can designate who will inherit assets, nominate a legal guardian for your children, and contain instructions for your burial. After you pass away, your Will must be filed with the probate court and then it can be carried out according to your wishes.
Probate is time consuming and expensive because it is a court proceeding. Probating a Will typically costs between $2,500 and $4,000. However, the cost can go depending on how big the estate is, how complex the assets are, and if someone contests the Will. If you’re going through probate in Utah the cost of probate Will likely include court fees, attorney fees, compensation to the representative of the estate, and probate bond. The average probate process takes four or five months, and longer if there are objections.
Probating a Will will certainly cost your family time and money. If there are disagreements between your devisees, those costs will rise as they will need to be dealt with in court. However, probate and family disagreements can be avoided.
The costs of having a Trust.
Setting up a Trust is one of the main ways we advise our clients to avoid the cost of probate, because a Trust does not have to be probated. A Trust securely assures that your assets will be distributed according to your wishes, with the least amount of hassle. A Trust simply transfers your assets to a Trustee that holds the assets on behalf of your designated beneficiaries (the people you want to leave your assets to). After you have died, the Trustee must distribute the assets that are in the Trust according to your wishes.
Depending on your personal situation, the cost of setting up a Trust varies. In Utah, setting up a Revocable Trust, a Trust that can be modified after you deposit assets into it and the most common type of Trust, can cost anywhere from $1,000 to $3,000.
Since you yourself set up your own Trust and pay for it as the work is done, having a Trust does not cost your beneficiaries any money. There is time and labor involved for the Trustee, however. We recommend that you provide instruction for their compensation and speak with your Trustee beforehand to make sure they agree to the job.
The best estate plan for you, whether that be a Trust or a Will or a combination of both, will depend on your personal situation and preferences. If you have questions about your estate and which kind of plan would best serve you, contact us today to set up a consultation.
385.334.4030