05/06/2021
It's been great to get so many questions from friends that I haven't heard from in a while. I've had a few recently regarding probate, so in case anyone else was curious, let me walk through the process in California:
When you die with an estate larger than $166k (counting the value of your home), that estate will go through probate. If you have a will, the estate will be distributed according to your will. If you don't, that's called "intestate", and it will follow the process outlined in section 6401 here: https://leginfo.legislature.ca.gov/faces/codes_displayText.xhtml?lawCode=PROB&division=6.&title=&part=2.&chapter=1.&article=
Even with a will, probate will take a minimum of four months and probably closer to a year. You will have a hearing that will cost around $450 (depending on the county), you will have to publish notice (low hundreds of dollars), and there will be a lot of paperwork. If you hire an attorney, that attorney will be entitled to collect a fee of 4% of the first $100k, 3% of the next $100k, 2% of the next $800k, 1% of the next $9 million, and .5% of the next $15 million.
So just ballparking it, if you have a home worth $400k and no other real assets, your beneficiaries are looking at around $1k in unavoidable fees, $11k in attorneys fees, a pile of paperwork, and waiting the better part of a year for everything to sort out.
By contrast, if you set up a revocable living trust, your "successor trustee" can take over immediately, and has an obligation to follow your trust docs to distribute your estate to your beneficiaries. It's a much easier process, and generally speaking, is considerably less expensive.
