What Does a Trust Cost?

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Rather than just a transaction, consider Estate Planning as a process that comes with certain outcomes. Instead of focusing on the cost of a trust find out why you need it.

Should you put a price tag on a secure future? Is the peace of mind that comes with knowing your legacy is secure worth an exact amount? Rather than just a transaction, consider Estate Planning as a process that comes with certain outcomes. Instead of focusing on the cost of a trust find out why you need it.

A trust is a legal entity that you transfer ownership of your assets to, perhaps in order to decrease the value of your estate or to simplify passing on assets to your intended beneficiaries after you die.

Creating a trust and full estate plan and asking for its price is valid, but selecting a lawyer based on price alone is the wrong approach.  This is one of the most common mistakes in estate planning, which involves business interests, wealth, and family dynamics as well. There is also no fixed menu of documents, and it can get difficult to understand with various wordings and provisions. There is no already-designed package to meet your wishes, and that is why a meaningful plan should start with a qualified estate planning legal team.

Pricing for estate planning and trust considers multiple factors:

  • How many trusts are needed and for whom?
  • What kind of assets will be transferred to each trust and in which process?
  • Will the trusts be represented as a gift, a sales option, or a combination?
  • What level of access, control, and protection should each beneficiary have?
  • Who will be the trustee?
  • What kind of estate, federal gift, GST, and income tax risks are involved, and how can they be minimized?
  • What family value or goal should be structured to reinforce?

Even the simplest plan can involve multiple trusts along with layered strategies and varied jurisdictions, along with the structure for transfer. All of these aspects should be dealt with and answered before creating the estate plan in order to have a clear vision. Therefore, asking for the trust cost before even making a plan won’t provide an accurate accounting.

Instead of focusing on just cost, a well-planned estate plan should follow a sequential approach with facts and information. What do you own? Who are the stakeholders? What are the objectives for family, tax, financial, and personal needs? You need to consider the risk, complexity, and cost for each aspect. Only then can you come up with a plan that comes with a coherent structure that allows addressing the cost.

Potential Factors that increase the price of a trust:

  • Where you live-location factors into pricing.
  • Having a large or wealthy estate with many assets can increase your trust costs. The more assets you need to transfer into your trust, the more you’ll probably pay.
  • Leaving assets to a business or creating a charitable trust can also require extra planning and legal work, which can increase the cost of creating the trust.
  • Planning for certain beneficiaries may prove more complicated, such as someone with disabilities or someone who is in the care of a legal guardian, and opening a trust for them (like a special-needs trust) can be more expensive.

Certain types of trusts offer distinct advantages like decreasing the value of your estate — potentially allowing you to qualify for income-restricted programs, like Medicaid. After death, a trust usually allows your loved ones to avoid the probate process, where a probate court determines who will get your things. A strong will can make probate smoother, but a trust can still offer more of a guarantee that your exact wishes are followed, which may make the costs worth it. Estate planning should never be reduced to a pricing exercise only. Contact us when you are ready to get started.