Knowing what goes into the cost of an estate plan, the question remains “How much? The cost of an estate plan will vary depending on the documents you need and the lawyer’s fee structure. If you go to an attorney for an estate plan, how much will you pay, and what determines that price? Three factors help answer these questions
- The type of product or estate plan that you need
- The type of legal fees your estate planning attorney uses
- Who actually does the work on your estate plan.
A couple of average wealth with small children will need an estate plan that focuses on guardianship and maximizing financial security in the event the parents pass away at a young age. This plan requires straightforward documents like a will, appointment of guardianship, and perhaps a basic living trust; while a wealthy individual with children from multiple relationships will need a plan that focuses on wealth management and legacy planning with careful consideration of family dynamics. This plan requires more skill in both strategic planning and document drafting, potentially involving multiple types of trusts, powers of appointment, and powers of attorney.
Keep in mind that fees for estate planning are not just a function of the time your attorney spends drafting documents. Good estate planning attorneys use their skills, knowledge, and expertise to construct a holistic plan that will help you accomplish your unique estate planning goals. You will pay more for the work of a more experienced estate planning attorney who can provide a complex plan. If you do not need a complex plan, consider finding an attorney who focuses on plans for simpler estates.
Essential Estate Planning Documents
You’ve likely heard of a will. Most people think of a will when they think about estate planning. While it is the most common legal document in an estate plan, a will might not be enough to make sure your possessions get into the right hands when you can’t manage them yourself.
Last Will and Testament
This is a written document that lists how you would like your belongings to be distributed after you are gone. If you want your cousin to have your antique lamp, you can put that in your will.
You can put your assets into a living trust for your benefit while you are still living. Upon your death, your belongings go to the person you designated in the trust, without the need for probate court.
Durable Power of Attorney
If you become incapacitated and can’t make decisions for yourself, a durable power of attorney can appoint someone to make decisions for you.
Healthcare Power of Attorney
Commonly referred to as an advanced care directive, a healthcare power of attorney gives someone else the authority to make decisions about your healthcare due to your incapacity.
Some assets, such as life insurance and 401(k) plans, can bypass a will or trust altogether if you designate a beneficiary. Otherwise, the court may decide who inherits all those funds.
The Cost of Estate Planning
Your total costs will depend on how simple or complex your situation is. How you will pay is as important as what you will pay. While retainer fees and contingency fees are typical for criminal cases, you won’t see them for estate planning. The cost of estate planning is usually calculated through one of three fee types which are
Hourly rate fee
Most lawyers won’t ask you to fork over any cash for an initial consultation. This first meeting might be in-person or over the telephone. During a consultation, the attorney will get insight into your situation to help them determine your estate planning needs. Don’t expect much information from this phone call. Estate planning is complex and can’t be handled in a single 30 to 60-minute encounter.
A flat fee is the most common type that lawyers charge for estate planning. With a flat fee, you will pay the same amount no matter how many times you call or email with a question. The attorney can explain things to you without worrying about running out the clock, and you will be more relaxed knowing you won’t get a surprise bill in the mail.
A typical flat fee estate plan includes the most common estate planning tools such as
A simple will
A powers of attorney for finances and property
A power of attorney for healthcare decisions
A living will outlining end of life decisions, and
An appointment of guardianship for parents..
Some attorneys will charge you by the hour to prepare an estate plan. Hourly rates can vary. You might find lawyers who bill anywhere from a higher point or more or vice versa. Shopping around before you hire an attorney is a smart move. You might be surprised how different lawyer fees can be, even in the same town.
How much should I pay
Knowing what goes into the cost of an estate plan, the question remains “How much?” The costs can vary widely. Some attorneys may prepare a simple will or power of attorney for as little as $150 or $200. On average, experienced attorneys may charge $250 or $350 per hour to prepare more sophisticated estate plans. You could spend more to work with such an attorney.
If you would like to learn more about the necessity of estate planning as regards the Pandemic, please contact any of our estate planning attorneys today.