Monday, June 30, 2008

Avoiding probate as a reason to use a trust

A post on one of the blogs I read, Estate Planning as a Career, gives another reason besides avoiding estate taxes to use a trust; avoiding probate:

Probate is expensive. In Florida, the law requires that the personal representative (or executor in other states) hire an attorney to help administer the probate estate. This same law suggests that a reasonable fee for that attorney is three percent of the total gross value of the property passing through probate. Add to that another three percent for the personal representative’s fee and you can begin to see how expensive probate can be.

If you own a $400,000 home and have $200,000 in investments, the six percent of fees can total $36,000. That’s money that your loved ones and heirs will not receive.

Very informative. I don't live in Florida, but I'll be researching the probate process in my own state.