How much does an Estate Plan cost? This is a question many ask, even before they know what an estate plan is and what it involves. While I understand the reason behind leading with that question, no competent lawyer will answer it until they know what you want and need. How can a reputable business person or professional quote you a price without gathering some initial facts?
It’s no different when you buy a house. Suppose you go into a realtor’s office and say, “I want to buy a house. How much is it?” How can that broker give you a price without knowing what you want, where you want to live, your budget, the type of dwelling (condo, gated community, country club, single family), how many rooms, pool, etc.? You get the point. Without more facts, that broker would be irresponsible in quoting you a price.
So, the short answer to the question of how much an estate plan costs is, “It depends, and it varies.” So let’s take a look at some of the factors that go into determining the cost of an estate plan:
Factors That Go into a Lawyer’s Fee.
Several factors go into the lawyer’s fee for their work. Keep in mind there may be others, but here are a few:
- The estate planning lawyer’s experience
- Number of documents to be prepared
- Is it a trust or will-based estate plan
- How complicated is the plan
- Are there sophisticated tax issues
- Are there many high-valued assets
- Number of real estate properties and where they are located
- Are all the assets located in the same state as the person creating the plan
- How many sub-trusts, e.g., special needs, pets, different trusts for each beneficiary
- Complicated funding issues, e.g., real estate located on tribal land
- Urgent need for documents
- Difficulty in accessing the client
- Is a lawyer required to travel?
Flat Fee or Billable Hourly Rate?
Once again, because not all lawyers are created equal, this is a question to be answered by the individual lawyer.
Billable Hour.
Many attorneys have an hourly rate and choose to charge by the hour. Some of those attorneys might break up the charge into small increments, such as one-quarter of an hour. For example, if the attorney invests up to one-quarter of an hour of their time on your work, they only charge you a quarter of their hourly rate. On the other hand, some hourly rate attorneys will charge you the entire hour fee, even if they spend thirty minutes on your work. Their fee agreement will likely say they blame XX for anything up to sixty minutes.
Flat fee.
More often, you find estate planning lawyers willing to charge a flat fee for their services. That means they will consider what they can reasonably charge for the work. They may have a flat fee for the entire estate plan and a reduced fee if they only prepare one or two documents within the plan. However, because all the documents within the estate plan work together, the competent estate planning lawyer rarely wants to break up the plan. But now and then, depending on the circumstances, you give a client what he wants.
Mixed Fee.
Depending on the work, some flat-fee lawyers will charge the flat fee but then assess an hourly rate for things like probate, trust administration, and litigation. Because those situations can take on their own life, it is hard to assess how long they will take to resolve. Case in point, probate can get complicated and last for years. If a lawyer quotes a flat fee thinking it will be done within three months, they will be disappointed when it takes ten years. Plus, that lawyer will be working for free for ten years.
Francine D. Ward
Attorney-at-Law, Author, Speaker
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