If you find yourself in need of hiring an estate attorney to assist you in the administration of a loved one’s estate, make sure you don’t end up paying way more than you need to.
Estate attorneys typically bill one of three ways: on a percentage basis; on an hourly basis; or on a flat fee basis. So which billing method is the right choice for you? Well let’s take a look at one these different methods really mean.
If an estate attorney tells you that they are basing their fee off of a percentage value of the overall size of the decedent’s estate what does this really mean? Well, if the estate is worth $500,000 and the attorney says their fee is going to 5% of the value that would translate potentially into a $25,000 legal fee. The problem with this method, aside from the fact that it might result in an extremely large and unjustified legal fee, is the question of what actually constitutes an estate or probate asset. Namely, if the estate consists of a $500,000 investment account that already has named and designated beneficiaries listed on it, then why in the world would you pay an attorney 5% to simply help you process and transfer the account to the listed beneficiaries? Clearly, when you’re dealing with an attorney who is using the percentage basis, you need to be very careful to determine in advance exactly what they intend to include as an estate asset when determining their fee.
Likewise, if an estate attorney tells you that they are going to handle the estate administration based on an hourly rate, the question then becomes how much will you actually be paying at the end of the day. The answer is that you simply won’t know until the estate is actually finalized. As you might imagine, this can often result in a very unpleasant and unexpected final bill.
The obvious benefit of the flat fee basis when it comes to estate administration work is that you will have in writing and know in advance exactly what you will be paying. Still, it’s important to ask the attorney how they are setting their flat fee and what assets they are including in making such a determination. Namely, a large estate doesn’t necessarily have to mean a large legal fee.
Remember, do your homework in advance. Talk to several experienced estate attorneys and hire the one whom you feel most comfortable with. Asking the right questions can save you a lot of time, trouble and money.
American Wills & Estates is a locally founded, owned and operated law firm with a practice limited to Probate Estate Administration and Estate Planning law. We are the #1 rated Probate Estate Administration law firm in Pittsburgh and throughout Western Pennsylvania. Contact us today to speak with a trusted and experienced Estate Administration lawyer and to schedule your free legal consultation. You’ll be glad you did.