How Much Does a Will or Trust Cost?
When someone calls or emails about estate planning — having a Will or Trust prepared — they first want to know if this is the type of work that I do. They want to know that I am competent, that I have seen many situations and can prepare documents that will effectively address their desires.
The second thing that people want to know is “How much is it going to cost?” This is a critical question to ask, and no one should ever feel reluctant in asking. In fact, I try to raise the “cost” question during that first contact with a potential client.
To give you a complete sense of the answer to this question, I am going to tell you first how I charge and second how some others charge.
I charge on an hourly basis. My current rate is $375/hour and I bill in tenths of an hour.
And you say, “But that doesn’t tell me what it is going to cost.” You are correct. I always give a fairly accurate range of how much time it will take.
For the most basic of Wills (e.g., with no trusts for minors or highly particularized gifting) then my total billable time should be about 3 to 4 hours. If I am preparing a Will package for a couple, then it will be closer to the 4 hours, because I will be preparing separate documents for each individual. Note that I refer to a Will “package,” because I include with client’s Will all necessary estate planning documents, such as Powers of Attorney and Advance Medical Directives.
For family-planned Wills with minor children and/or for a blended family, my total billable time should be 4-6 hours. Variables that effect the bottom line are family and financial complexities, highly particularized gifting (gifts of money or tangible property to many individuals or charities).
One area of estate planning that requires more time – sometimes significantly more – is Estate tax planning; how much more time is required depends on the type and level of planning required for the client’s specific financial condition and needs.
For basic or family-planned Will, one of our RRBMDK associate attorneys may work with you. In that case, the billable hourly rate you are charged will be lower, but the number of hours required to complete the work may be higher, and there will be some of my time for review. However, the total costs should be somewhat less if an associate does most of the work.
What are we doing with the time you are being billed for? Our time includes the initial consultation, drafting of documents, telephone calls or emails to answer questions or make changes, research (if any), revising documents and a second meeting to sign documents. All activity is recorded in detail, along with how long that particular activity took, and this is reflected on your invoice.
When do I expect to be paid? I usually do not send a bill until the estate planning is complete, which takes about a month or less. Sometimes clients, for any number of reasons, are not able to complete the process for an extended period; and I may send an interim bill for fees earned to date; once we have finished, there would then be modest bill for any remaining time.
Some attorneys charge a flat fee for estate planning and other types of legal services. This has the appeal of certainty, but it also means that the “flat fee” may be more than you would in fact spend if the work were billed hourly. When considering whether a flat fee is appropriate, you must ask yourself whether the attorney has simply estimated the range of what the work would cost on an hourly basis, and is charging all clients a “one-size fits all” fee at the highest end of that range – ensuring he/she covers his/her time, but not taking into account matters that would fall at the low end of the range. At RRBMDK, we prefer to charge for our actual time. We believe that this is the fairest way to bill, since some clients require more time and some less, but each pays based on the amount to time required.
You may also see advertised estate planning services for very modest flat fees. Often this is done in what is called a Will “mill,” where documents are churned out with little professional thought and everyone comes out with nearly identical documents. If price is your only consideration, then we are probably not the firm for you. For us, we try to listen to what you would like to accomplish and offer options of how to address your goals. We also try to explain which options are practical and cost effective and which ones may be more perfect, but can’t pass any cost-benefit analysis.
Is there a less expensive way to do your estate planning? What about Legal Zoom or a form from Staples? Those are definitely options. You may very well happen across the form that meets your needs; you may fill it out correctly and you may observe the legal formalities for executing your Will and other documents. Chances are, however, that the following will happen: 1) You will spend an inordinate amount of time learning about Wills and Trusts – time that you could be doing things you like doing. 2) If you study enough, you will have a good chance (50% – 60%) of doing it right, but are those really good odds? Will there be a result that makes you turn over in the grave?
(By analogy, if you break your leg, you are surely smart enough to go on Web MD and figure out how to splint your leg. It will save the cost of a hospital and doctor visit. If you spend enough time on Web MD, you can surely figure it out. But is that how you want to spend your time? And if you spend enough time and have a 50% chance of getting your leg set correctly, are those the kind of odds you want?)
Would I save money doing a Revocable Living Trust (RLT), instead of a Will? Great question. Short answer is no. The RLT is an alternative way to plan one’s estate. Many attorneys will tell you that you must have a RLT to avoid probate, save taxes and maintain privacy. A RLT usually costs significantly more up front because you must transfer the title to all of your property into the trust. You also still need a Will in case some of your property is not transferred into the trust. (You can add about two hours to my time estimates above for a RLT package.)
But “do I save on the backend with a RLT?” Not really, because administering a RLT requires almost exactly the same work as administering a Will; and any tax planning that can be done with a RLT can also be done with a Will. Plus with a RLT, if you have real estate and need to refinance it, you will likely be required to transfer it out of the trust for the refinance and then you must transfer back into the trust – more costs and hassle. Bottom line is that you pay more for a RLT, have more hassle, and gain very little, if any, benefit. For more information on RLT’s, see Do I need to Revocable Living Trust to maintain my privacy?.
IF YOU HAVE ANY ADDITIONAL QUESTIONS ABOUT ESTATE PLANNING, OUR OTHER LEGAL SERVICES, AND/OR OUR FEE STRUCTURE AND BILLING PRACTICES, PLEASE CALL.