Estate planning costs can be looked at in two ways…
First, what is the cost of creating an estate plan?
Second, what is the cost of NOT creating an estate plan?
First, let’s examine the cost of NOT creating an estate plan.
The Estate Planning Costs of NOT Planning
If you don’t create your own plan, then the State has written an estate plan for you!!!
When you decide to NOT create your own estate plan, you are agreeing that the State’s default estate plan is okay with you.
The State’s Estate Planning Costs
Here are the estate planning costs associated with the State’s plan.
If you can’t manage your own affairs, pay bills, make decisions, and more then the State says your family must go to court. They must go to court to get permission to make your decisions. This is called a Guardianship.
The court rips away your rights to make decisions and gives it to a family member. It is not necessarily the family member you would have picked to stand in your shoes.
The financial cost of a guardianship is about $3,500 up front and about $300 per year for the annual reports.
Guardians are restricted in what they can do. Often, they end up back in court, at additional cost, to get permission to do things.
When you pass, then your family must Probate your estate. Only, without a plan, the State’s plan is used.
The State’s plan requires that your family goes through a very formal, very strict, very expensive probate.
You can expect this to take at least 1 year of time and cost at least $4,000.00!
This is only the financial cost. It doesn’t include family strife and the emotional costs of probate. Until probate is over, many people can’t grieve properly.
Total Financial Costs
Financially, your family is looking at $3,500 for you, $3,500 for your spouse and $4,000 for probate. This comes up to about $11,000. Or $7,000 for guardianships and $4,000 for probate.
Estate Planning Costs
As of October 2021, you can have a comprehensive estate plan created for about $2,150.00 for a couple.
This plan includes
- Durable Powers of Attorney to stop guardianships
- Healthcare Powers of Attorney to stop guardianships
- HIPAA Waiver to allow the people you want to talk to doctors, nurses, and other healthcare professionals
- Living Will to tell doctors you don’t want to be kept alive artificially if nothing else can be done
- Last Wills and Testaments to express your wishes
- Beneficiary Coaching to teach you how to pass property outside of probate
- Deed to pass your house outside of probate and protect it from Medicaid recovery