Lawyers have two ways of charging clients to do their estate planning. They can charge a flat-rate or by the hour. For lawyers who charge a flat rate, the standard minimum flat rate may range from $800 to $1,800. Note the word “minimum.” The rate may even go as high as $2,000 to $3,500. (Some may even charge more.)
The wide range in rates can be explained by the diversity in the circumstances of the estate owner and his estate. For example, a person with a simple estate (e.g., owns one house, one car, some small investments) and uncomplicated circumstances (e.g., one marriage) should have a relatively simple plan. On the other hand, a person with a muti-million dollar estate with assets in several states as well as several marriages will have a more complex estate plan.
Other attorneys may charge on a per-hour basis. Some clients may balk at this billing structure because they are not sure how much the final bill will add up. In such a billing system, the client will be billed for every consultation he does with the lawyer – even phone consultations. This can be stressful for many clients. (It may surprise people to know that many lawyers also do not enjoy keeping track of their billable time.)
If your lawyer or law firm quotes you a flat fee, you may still want to ask him for his standard hourly rate since this is indicative of his experience. Usually the higher the hourly rate, the more experienced the lawyer is. Also the more experienced the lawyer is, the faster he will be able to do the estate plan.
The fees cover the initial meeting, preparation of basic documents, review of documents, and signing of the documents. Some lawyers will also include assistance service with funding your trust as part of their flat fee; while others may bill a separate funding fee you for such service. Your attorney will help you in preparing the four basic tools in estate planning which are: the will or living trust, durable power of attorney, living will or advanced medical directive and a medical durable power of attorney, which is also known as a health care proxy.
You may sense if the fees are reasonable when you do your initial search for your estate planning attorney. You should have given your prospective lawyers an idea of your estate and personal circumstances while he should have given you an informal quote.
When you hire a competent estate planning attorney, you are actually buying peace of mind. With a well-written estate plan (executed with the help of your estate planning attorney), you can be assured that your wishes will be followed after you pass away. Moreover a well-written estate plan can save you quite a sum in estate taxes. In other words, when you choose an experienced estate planning attorney, you can be sure that every penny you pay him will be worth it.