With the 'Great Wealth Transfer' on the
horizon, millions of Americans will enter the probate process, and
nearly all underestimate every element of the process
SAN
DIEGO, July 17, 2024 /PRNewswire/ -- Trust &
Will, the leading digital estate planning and settlement platform
in the U.S., today released the findings of "The State of Probate
in America," a groundbreaking study that unveils a startling lack
of awareness surrounding the probate process among millions of
Americans.
Americans are Blissfully Unaware of the
Cost and Length of the Probate Process.
Probate, the legal procedure for estate settlement, remains
shrouded in misunderstanding and fear. Despite its significance,
only 65% of Americans understand its definition, while 19% remain
uncertain. The study reveals a significant gap in understanding,
with 35% admitting to not comprehending the process at all.
The study findings underscore the urgent need for heightened
awareness and preparation in estate planning. Key findings from
Trust & Will's 2024 Probate Study include:
- Underestimation of Probate Process: Most Americans
vastly underestimate the duration and costs associated with
probate. Despite the average timeline of 20 months, only 2% of
respondents believed it would take that long, while 37% were
uncertain of the timeline. Similarly, 56% have no idea about the
costs involved, with 10% expecting it to be $1,000 or less, and only 4% anticipating costs to
exceed $10,000.
- Perception of Difficulty: Over half (52%) perceive
probate as somewhat or very difficult, emphasizing the emotional
and procedural complexities involved. Despite this, only 40%
believe they have a strong understanding of the process.
- Need for Guidance: Most Americans (40%), even with their
general lack of knowledge about probate, said that it will be
"somewhat difficult" to manage the probate process. A staggering
65% of Americans would seek help from a probate attorney,
highlighting the reliance on professional assistance during the
complex process.
Americans are Blissfully Unaware of the Cost and Length of
the Probate Process
Despite its inevitability for many,
probate's costs and duration are widely underestimated. Nearly half
of Americans are unaware of the costs, with 56% having no idea of
the financial implications. Furthermore, the average timeline of 20
months is drastically underestimated, with most respondents
believing it to be significantly shorter.
Americans vastly underestimate the financial costs of probate.
More than half (56%) have no idea what it costs; 10% believe it
will be $1,000 or less, and only 4%
believe it will cost more than $10,000. It is commonly estimated that probate
costs average 3-7% of the total value of the
estate1, so an estate valued at $750,000 could incur probate fees ranging from
$22,500-$52,500.
Most Americans are more optimistic than realistic about
timelines: 15% of people believe it will take just 1-3 months, and
another 15% think 4-6 months is the average timeframe. Twelve
percent believe an estate can be wrapped up in 10-12 months. The
majority, 37%, say they aren't sure what the probate timeline will
be.
Probate will greatly delay the 'Great Wealth
Transfer'
Experts and economists are predicting the 'Great
Wealth Transfer,' one of the largest transfers of assets from
owners to inheritors in modern history, with an estimated
$72.6 trillion expected to transfer
between generations. But most people are unprepared - Trust &
Will's 2024 Millennial Study found that 62% of millennials do not
have a Will or Trust and 34% do not know if their parents have an
estate plan.
Probate is a process that can be avoided with proper estate
planning. Without the existence of a solid estate plan, probate is
dictated by location, and many people aren't aware of whether
they'd have to go through the process. Half (50%) of Americans have
no idea if they live in a state or county that requires probate to
settle an estate.
"As the United States stands on the brink of the largest
intergenerational wealth transfer in history, our latest study
reveals a concerning lack of preparedness among Americans regarding
the probate process," said Cody
Barbo, Founder and CEO of Trust & Will. "For most
Americans, the inheritance process is far from easy - and the
lengthy and costly probate process can make it even more difficult,
especially as people are grieving the loss of a loved one. Amidst
an aging population that isn't fully prepared for end-of-life via
estate planning, millions of Americans will be plunged into the
long, expensive, and emotionally draining process of probate. We
hope to shed light on this topic and make it less taboo, while also
providing resources and education to ensure a smoother transition
of assets."
To learn more and see the full results of the study, visit:
https://trustandwill.com/documents/probate-study-2024
Methodology
Trust & Will worked with
OnePoll to survey a nationally representative sample of 1,000
Americans aged 18 and older. This survey was conducted from
March 13-18, 2024.
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mission of helping every family leave their legacy. To learn more,
visit trustandwill.com.
Trust & Will is an online service providing legal forms
and information. Trust & Will is not a law firm and does not
provide legal advice.
1 Estimates made by estate planning
attorneys and CFPs who have written extensively on the topic,
including Chris Nudo, Margarita Cheng and Philip B. Shane, a professor at College of William & Mary - Raymond A. Mason School of Business.
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