How much does a trust cost to maintain?

[lucky777]

My dad, who's now 81, has recently been revisiting his estate plans, and we're trying to understand if setting up a trust for our oldest sister (who has some financial issues) is doable without such an expensive estate. The current estate is mid-6 figures, I would be named as a trustee along with my two brothers. We just want to ensure our sister's inheritance is protected, even if it's just a little bit. Before we meet with dad's lawyer, can anyone share the maintenance costs for a trust in this range? Thanks so much.

 

[Funny-Mood2432]

I think this is doable with a mid-6 figure estate! Maintenance costs can vary, but if you go with a professional trustee, expect around 0.5% to 1.5% of the trust's assets annually. If you and your brothers are handling it yourselves, costs could be much lower mostly legal and tax prep fees.

 

[O.kaka]

My dad, who's now 81, has recently been revisiting his estate plans, and we're trying to understand if setting up a trust for our oldest sister (who has some financial issues) is doable without such an expensive estate. The current estate is mid-6 figures, I would be named as a trustee along with my two brothers. We just want to ensure our sister's inheritance is protected, even if it's just a little bit. Before we meet with dad's lawyer, can anyone share the maintenance costs for a trust in this range? Thanks so much.

A simple revocable trust with a sub trust for your sister's share (possibly with spendthrift provisions) can make a lot of sense, the ongoing maintenance costs are usually pretty minimal unless you're using a professional trustee, you and your brothers are acting as trustees, it's often just the cost of tax prep and maybe a bit of legal advice now and then

 

[Lukaaas]

@lucky777 You're right to ask before meeting the lawyer. If you and your brothers manage it, most of the cost will just be annual tax filings and occasional legal check-ins, which shouldn't be too heavy on a mid-6 figure estate. Also what @O.kaka said is helpful. Spendthrift provisions could definitely give your sister some protection without blowing up costs. Keeping it mostly in-house keeps fees low.