If you live in Missouri and you die without an estate plan, your estate will go through the probate court. From there, the court will order that your debts be paid and that your assets be distributed in a way that has been determined by the state of Missouri. You have no control over this process and cannot dictate how your money is allocated after your death.
The probate process usually takes about 12 months, but can sometimes take several years, and will cost about 6% of the gross value of your estate. This figure includes fees for the court itself, as well as attorney’s fees, accountant’s fees, and appraiser’s fees. This is money your children and other beneficiaries will not see.
This process affords no privacy for you or your beneficiaries; records of probate proceedings are entirely public. Additionally, if you have minor children and die without electing a guardian in your will, it will be up to the court to determine what happens to your children.
The goal of any good estate plan is to minimize taxes, probate costs, and other liabilities and to preserve the value of your assets for future generations.
Probate vs. Non-Probate Property
Oftentimes, people will avoid creating an estate plan because they are concerned that doing so will be too costly. They think that estate planning is only for very high net worth individuals and that they do not have enough assets to be concerned with. However, statistics show a different result. Without an estate plan, probate will cost the estate more money. The chart below exemplifies the costs of probate versus an estate plan for an estate worth $500,000. While an estate plan would have cost a few thousand dollars, probate costs (court fees, attorney fees, and taxes) total approximately $25,000. You need not pay an attorney up front, as often fees are filed for in court and paid directly from the estate’s assets.
