Die without an estate plan and your financial life becomes public record. Probate is the court process that settles your estate, and it’s open to anyone willing to walk into a courthouse: what you owned, what you owed, and who inherited it all become searchable. Your family also pays for the privilege, typically 2% to 7% of the estate’s value in court and legal fees, and waits 12 to 18 months before seeing any of it.
What probate actually costs
On a $500,000 estate, that 2-7% range works out to $10,000 to $35,000 in fees that go to courts and attorneys instead of your family. The state inventories everything you own, pays off anyone you owed money to, and distributes what’s left according to your will, or according to state law if you don’t have one.
The privacy loss compounds the financial one. Business competitors, estranged relatives, and scammers who monitor probate filings can all see exactly what your family inherited and when, which creates real security risk during a period when your family is already vulnerable.
Why so many people put it off anyway
Only about 57% of Baby Boomers have an estate plan in place, and the number drops with each younger generation, down to 39% for Gen Z. The reasons people give track pretty consistently: about 40% say they just haven’t gotten around to it, 33% think they don’t have enough assets to bother, 13% are put off by the cost of setting one up, and 12% simply don’t know where to start.
The “not enough assets” reasoning is usually wrong. If you own a home, hold a retirement account, or carry a life insurance policy, you have more than enough at stake to benefit from basic planning, and the cost of skipping it, the probate fees and delay described above, tends to run higher than the cost of setting up a plan in the first place.
Revocable trusts: the default for most people
A trust is a legal structure that holds assets on behalf of beneficiaries according to instructions you set. A revocable trust stays entirely under your control while you’re alive: you can add assets, remove them, change beneficiaries, or dissolve the whole thing whenever you want. You typically act as your own trustee, managing everything exactly as before.
The benefit shows up at death. Assets titled in the trust bypass probate entirely, so there’s no public record of what your family received, and a successor trustee can distribute assets or step in immediately if you become incapacitated, without a court needing to intervene. Tax-wise, a revocable trust is a pass-through: you pay taxes on trust income exactly as you would if you owned the assets directly, since the IRS treats them as still yours.
Irrevocable trusts: for estates near the exemption threshold
An irrevocable trust is a different commitment. Once assets go in, you can’t take them back, and you can’t act as your own trustee. The tradeoff is that those assets move outside your taxable estate.
As of 2026, individuals can pass $15 million to heirs free of federal estate tax ($30 million for married couples); anything above that is taxed at 40%. When you fund an irrevocable trust, you use up part of that lifetime exemption based on the asset’s value at the time of transfer, but any growth after that point escapes estate tax entirely. Transfer $1 million in stock into the trust and watch it grow to $5 million over time, and only the original $1 million counts against your exemption. The $4 million in growth is outside the estate for good.
This makes irrevocable trusts most useful for people whose estate is approaching or likely to exceed the exemption threshold, and it rewards early action: transferring an asset while its value is still low uses less of your exemption to shelter potentially much larger future gains. For most people well under that threshold, the administrative overhead of an irrevocable structure isn’t worth it yet. A revocable trust and updated beneficiary designations cover the real risk.
The mistakes that undo good planning
A will alone doesn’t avoid probate; anything controlled by a will still goes through the court process. Beneficiary designations on retirement accounts and life insurance override what your will or trust says, so they need to stay current. Creating a trust document isn’t enough on its own, either: assets have to actually be retitled into the trust, or it does nothing. Pick a successor trustee who’s organized and trustworthy, since they’ll carry real responsibility, and tell your family where the documents live so nobody’s searching for a folder while grieving.
Start with an inventory of what you own, including digital assets like cryptocurrency, decide what you’re actually trying to accomplish (avoiding probate, minimizing tax, providing for minor children), and bring in an attorney who specializes in trusts and estates rather than treating this as a DIY project. Revisit the plan after marriage, divorce, a birth, a death, or any major shift in your net worth.
Educational only, not tax, legal, or investment advice. Check primary sources and speak with a qualified professional before making financial decisions.
