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 -- 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.
ABOUT TRUST & WILL
Trust & Will is simplifying estate planning and settlement with attorney-approved, legally valid documents and processes designed to adhere to individual state guidelines. Since 2017, we've helped hundreds of thousands of Trust & Will members leave their legacy with an affordable way to create an estate plan or settle the estate of a loved one. Our platform uses bank-level encryption that protects customer data and complies with the highest security standards, including SOC 2 and HIPAA. Trust & Will is a certified B Corporation and is the official estate planning benefit provider for AARP members, along with several leading financial institutions, who all believe in our 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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