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How Much Does a Will or Trust Cost?

shellys
Shelly Skandrani Updated: March 21, 2024 • 7 min read
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Table of Content
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Key Points:

  • Wills and trusts are crucial for safeguarding your family's future, providing peace of mind despite their complexity and costs.

  • Creating a will or trust can cost anywhere from $0 for DIY options to $10,000 with professional help, depending on your estate's complexity.

  • A complete estate plan covers your health, finances, and dependent care with various essential documents.

Welcome to the epitome of adulting: Setting up your family’s future. Wills and trusts are legal tools that are a crucial part of your estate planning. They ensure your wishes are honored and your loved ones are cared for after you're gone. 

Unfortunately, many people put the process off because navigating the legal jargon and deciding which path is best can be daunting. Not to mention expensive. 

Sometimes, it all just feels a little too morbid. But you can’t let that stop you.

You have worked hard your whole life to provide for your family. A will can give you peace of mind, knowing that your family will be financially secure after you pass away. The sooner you start the process, the better. 

So, let’s break down your options and highlight the key differences and benefits. 

Average Costs to Prepare a Will or Trust

The cost of drafting a will or trust can vary widely depending on several factors, including your estate's complexity, location, and whether you hire a lawyer or use an online service.

Typically, a will for an individual can cost between $0 and $1,000. Whereas a trust can start at $300 and even exceed $10,000.

  1. DIY preparation
    • A will: $0 to $50
    • A trust: $30 to $225
  2. Online services
    • A will: $20 to $100+
    • A trust: $60 to $250+
  3. Hire an attorney
    • A will: $500 to $1,000+
    • A trust: $1,000 to $10,000+

Why Are Wills and Trusts Important?

Writing a will or trust is understandably overwhelming to many. After all, you need to get all your finances in order, organize a plethora of paperwork, and make hard decisions. But if you don’t do that, you’re leaving all that stress for your loved ones to deal with. 

The sooner you start planning, the faster you’ll understand which documents are missing and where your financial weaknesses are. Starting early gives you time to grow your savings and optimize your investments. 

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What’s the Difference Between a Will and a Trust?

Now, you need to decide between a will or a trust. But what’s the difference between the two anyway? Let’s break that down and simplify.

Wills: Your Last Word

A will is a legal document that outlines your wishes regarding the distribution of your assets and the care of any minor children. One of the most significant advantages of a will is its simplicity in creating and modifying. However, wills go through probate, a public and often lengthy legal process that can be costly.

Trusts: Flexible Management

On the other hand, trusts offer a more flexible way to manage your assets. They are more complex but apply during your lifetime and after your passing. A trust is a legal arrangement to transfer your assets to a trustee. The trustee manages and distributes them to your beneficiaries according to your instructions. 

Trusts can be used to minimize estate taxes, protect your estate from creditors and legal judgments, and avoid the probate process, making the transfer of assets quicker and more private.

Factors That Affect the Average Cost of a Will and Trust

Several factors can influence the average cost of a will or trust. Understanding these factors can help you make informed decisions about your estate planning needs.

suburban estate

Factors Affecting Wills:

  • Complexity of the estate: This includes the number of assets, their types (real estate, businesses, investments), and how you wish to distribute them. The more complex the work, the higher the fee due to the increased time and expertise required.
  • Complexity of family situation: If you’ve divorced, have a blended family, have a special needs child, or have other factors.
  • State of residence: Legal hourly rates vary significantly by location due to disparities in the cost of living and local demand for legal services. Urban areas typically have higher rates than rural areas. It’s worth researching law firms before committing.
  • Attorney’s expertise: Reputable specialized estate planning attorneys often charge more. However, they bring a depth of knowledge that can be crucial for complex estates. 
  • Additional legal advice: If your estate planning needs include tax planning, setting up guardianships, or navigating complex family situations, additional legal advice may be necessary, increasing the cost.
  • Revisions and updates: Your will may need updates due to changes in your life circumstances, assets, or the law. These revisions can add to the cost.

Factors Affecting Trusts:

  • Type of trust: The cost can vary depending on your type of trust (revocable vs. irrevocable, living vs. testamentary). Some trusts are inherently more complex and require more work to establish and maintain.
  • Purpose of the trust: Trusts designed for specific purposes, such as tax avoidance, asset protection, or special needs planning, may require specialized legal expertise and cost more to set up.
  • Funding the trust: Transferring assets into the trust is an essential step that can involve additional costs. This is especially true if it includes real estate or other assets that require formal title changes.
  • Ongoing management: Some trusts require ongoing management by the trustee, which can incur administrative costs, especially if a professional trustee such as a bank or trust company is involved.
  • State laws: Trust's legal requirements vary by state, affecting the complexity and cost of establishing and maintaining a trust. 

As in all important life decisions, researching and getting quotes from multiple attorneys can help you find the best service for your needs and budget. 

Online legal services such as Trust & Will can be a cost-effective alternative for more straightforward estates. However, ensuring these services comply with your state's legal requirements is essential.

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Other Documents Needed for Estate Planning

When drafting a will — it's not just about who gets what. A comprehensive estate plan includes other vital documents that work together with your will or trust:

  • Advance Directive: Also known as a living will, outlines your medical treatment if you become unable to communicate or make decisions for yourself. This can include instructions on life support and end-of-life care preferences.
  • A durable healthcare power of attorney: Appoints someone you trust to make medical decisions on your behalf if you're incapacitated. It often works alongside an advance directive.
  • A durable financial power of attorney: Grants someone you trust the authority to handle your financial affairs if you cannot. This includes paying bills, managing investments, and other financial decisions.
  • Beneficiary designations: Updating your beneficiary designations on life insurance, retirement, and bank accounts is crucial. These designations can supersede your will and should reflect your current wishes.
  • Guardianship designations: If you have minor children or dependents, this will ensure they are cared for by someone you trust in the event of your death.
  • Letter of intent: A more informal document that provides additional details and explanations about your will or trust. While not legally binding, it can guide your executor.
  • Digital asset inventory: With the rise of digital assets, including social media accounts, online banking, and digital currencies, it's increasingly important to include instructions on how these should be handled.

Each document plays a vital role in a comprehensive estate plan, ensuring that your health, financial affairs, and dependents are handled according to your wishes. 

Because laws vary by location and personal circumstances differ, consulting with an estate planning attorney to determine the appropriate documents for your situation is advisable.

You might also discover that you’ve accumulated some debt due to health issues, home repairs, or other life circumstances. Reworking your budgeting and consolidating that debt makes it easier to handle, especially if it is passed on to your family, which is often the case.

After all, you don’t want to make things harder for them.

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What Are the Benefits of a Will vs. a Trust?

  Will Trust
Process A more straightforward process. A more complex process, with additional documents.
Intention Effective after one's death. Usually, it comes secondary to trusts. Provides guardianship for minor children. Effective once signed and funded. Generally, it takes precedence over wills. Does not provide guardianship.
Fits for Those with minor children or dependents, and those with specific wishes for end-of-life care. Those who want their beneficiaries to receive assets while they’re still alive. It could also reduce estate taxes or avoid probate after death.
Probate laws Wills may be subject to probate, which is a public legal process. People may contest your will. It is less likely that a trust will be successfully challenged because it bypasses probate.
Taxes Wills do not avoid federal estate taxes. This ranges from rates of 18% to 40%. As of 2024, it usually only applies to over $13.61 million per individual. Using irrevocable trusts can provide tax benefits and protect your estate from creditors. Revocable trusts generally do not.
Protection during incapacity The provisions of a will take effect after you die. They do not protect your assets if you become incapacitated. Trusts can protect your assets if you are incapacitated while still alive.

Can I Just Write a Will or Trust Myself? 

Yes, you absolutely can, but it's essential to proceed cautiously to ensure it's legally valid and doesn't create complications for your loved ones later. 

While self-made wills are legal, they must meet state-specific standards, including witness requirements and, in some cases, regulations about hand-written wills. To avoid potential issues, ensure your DIY will complies with your state's laws. 

The Bottom Line

While the subject might seem daunting at first, understanding these essential estate planning tools is easier than you think. 

You might consider a simple will to ensure your assets are distributed according to your wishes. Alternatively, you could opt for a trust that provides your loved ones more flexibility and privacy. Either way, the key is to start the process now, informed and prepared.

Like a fingerprint, every person’s life circumstances are uniquely different. Choosing between a will and a trust is about finding what's best for your family. 

While DIY options offer a cost-effective way to get started, consulting with a professional can provide peace of mind. Ensuring that your estate plan is solid, legally binding, and tailored to your needs is the ultimate step towards protecting your legacy and caring for those you love. 

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FAQ

What's the difference between a will and a trust?

A will is a legal document that outlines how you want your assets distributed after your death and can appoint guardians for minor children. A trust can be used to manage your assets during your lifetime and after, avoid probate, and offer more privacy.

Do I need a lawyer to create a will or trust?

While not legally required, consulting a lawyer can ensure that your will or trust complies with state laws and meets your specific needs, especially for complex estates. 

How much does it cost to set up a will or trust cost?

The cost can vary significantly. A DIY will might cost little to nothing while hiring an attorney for a will can range from $500 to $1,000+. Trusts are generally more expensive, with attorney fees ranging from $1,000 to $10,000+, depending on complexity. Online services offer a middle ground in terms of cost.

Can I avoid probate with a will?

No, wills do not avoid probate. The probate process can be time-consuming and public, but it's necessary for validating the will and distributing assets according to it. Trusts, however, can avoid probate.