You may have been advised to avoid probate at all costs, but do you know why?
Sometimes probate is a good choice. Probate is a court-supervised distribution of your assets after your death. There are systems in place to manage the collection, valuation and distribution of those assets. Court approval is required for appointment of your representative and for many transactions. If there are objections to the appointment of the representative or any of the transactions, the judge will listen to those objections and make a decision. For
these reasons, it is a safe and effective way to distribute the assets. However, it can be expensive and slow.
In California your representative and the attorney for your representative are paid on a percentage basis that is set by law. They each receive 4% of the first $100,000, 3% of the next $100,000, 2% of the next $800,000, 1% of the next $9,000,000 and 0.5% of the next $15,000,000 and a reasonable amount over $25,000,000. For an estate of $500,000, the attorney and the representative would each receive $13,000.00. There are also court filing fees and referee fees, and if extraordinary services are rendered, the attorney and the
representative could be awarded much more in fees.
In Orange County, a simple probate takes about one year from filing the Petition to termination, and a complex probate estate or a probate where the parties disagree could take years. That means that your loved ones will not receive their distributions until long after your death.
If you factor in the public nature of probate and the hassles of your representative appearing in court, taking time from work and navigating the legal system, probate is not an attractive choice especially if you compare probate to the cost of preparing a revocable trust (most likely less than $3,000) and the ease of transferring assets from trustee to beneficiary. I suggest that you weigh all of these factors when deciding whether to try to avoid probate or not.
Originally posted by Susan on September 24, 2012