Planning for what happens with your assets when you die can help your beneficiaries avoid expenses and complications. But not all estate plans are created equal. We will break down the average costs of estate planning, and include factors you may want to keep in mind to best protect your money, property, and other assets without breaking the bank.
The Basic Costs of Probate
If you’re a Georgia resident, and you pass away with or without a simple will in place, your estate will go through probate court before it is disbursed to your loved ones. The average cost of uncontested probate in the state of Georgia is generally between 3% and 8% of the total value of your estate and includes various fees. Some of the fees people may encounter during the probate period may include the following:
- Probate Attorney fees
- Appraisal/ Land Survey fees
- Accounting fees
- Court fees
- Filing fees
- Executor fees
- Surety Bonds
A contested probate process would cost significantly more time, money, and complications to the probate court process. Though living trusts may appear to have significant upfront costs, they are designed to decrease long-term costs and administrative complications, and they may be the right solution for saving money over time.
Breaking Down the Costs and Benefits of a Living Trust
Georgia residents are often much better served by putting their estates in a protective revocable living trust. Costs start at a few hundred dollars for simple estate administration. A revocable living trust ensures your assets and property will be handled to your specifications after your death. Creating a living trust with the guidance of an estate planning attorney will cost you and your loved ones less money, time, and complications in the long run. Here is more information about potential cost-savings with a living trust:
- Save on Taxes
While there are federal estate tax limits that your attorney can review with you, Georgia has no estate tax or inheritance tax. It should also be noted that the estate will pay income taxes for the last year of the decedent’s life and the administration period after their passing. Creating a living trust enables quick and painless administration to cut back or cut out some of those costs.
- Quality Guidance and a Lower Overall Fee Limit
Once the trust owner passes away, There will be management or administrative fees. These fees are generally between 1% and 5% of the total estate (compared to the 3%-8% fees to administer probate). Working with an estate planning attorney can be a cost savings benefit. They will advise you of savings opportunities, such as gifting from the trust while the benefactor is still living, or protection measures to take regarding investments, life insurance, and state and federal tax laws.
- Prevent Leaving Beneficiaries Vulnerable
Leaving assets to your loved ones can create unforeseen expenses and complications down the line. For instance, there may be tax implications that you’re not aware of that could come at a financial cost to your loved ones. Additionally, If you have a loved one with special needs or chronic illness, a significant inheritance may make them ineligible for Medicaid or other benefits and assistance programs they may rely on. Working with an expert to help you protect your financial interests could create peace of mind that your loved ones are cared for.
Practical Estate Planning Guidance
While most people assume that a living trust is more expensive, in the long run, it can save you both time and money and leave you with a clear roadmap for how to help your loved ones access their inheritance with fewer complications and expenses. If you are ready to speak with Georgia estate planning experts to learn more about the benefits of creating a revocable living trust, contact the team at Smith Barid today.