This is the second and final part of our ‘understanding probate and estate administration’ blog series. If you missed part one, you can read it here.
The first blog in this series identified the difference between probate and estate administration. It shared that probate actually just refers to the ‘Grant of Probate’ which is obtained before an Executor or Administrator starts to gather in the assets associated with an estate. And estate administration is much more than that, it is the process of dealing with a person’s legal and tax affairs after they have died and covers everything from bank accounts, belongings and property to debts, pensions and Inheritance Tax.
This blog goes one step further and looks at the options available to an Executor or Administrator when a loved one has passed away and they have the responsibility of dealing with the estate. This includes the do-it-yourself approach, seeking the help of a traditional provider or using an estate administration service.
The options available to an Executor or Administrator
There are three main options available to an Executor or Administrator when dealing with the estate of a deceased person. They can opt to do it themselves, work with a traditional provider or use a specialist estate administration service. There are pros and cons to all methods and which method your client may want to use will depend on the circumstances of each case. We are going to clearly outline the advantages and disadvantages of each of the different options to make the decision easier:
1. Do-it-yourself (DIY)
With the DIY approach, there is potential for your client to save money whilst remaining in full control. This method can suit those who have the time on their hands and understand the legal jargon. However, this method has plenty of hindrances and risks. It can be time-consuming, it requires a large amount of paperwork, your client faces the legal and financial responsibility for administering the estate correctly and expertise is required as it is not an easy task so plenty of research is likely to be involved.
2. Traditional provider
A traditional provider is often the first place people look and there are some benefits to opting to use their service including them typically being geographically local to the client and taking on the task of applying for probate. Additionally, they often charge a percentage of the estate and/or hourly fees which could appear cheaper and easier to understand in the first instance. This pricing model can also be a downside to this approach as the final bill is often unknown when they are charging for their time and expenses. There are many other disadvantages to this method including that the provider may just be offering to obtain the “Grant of Probate” rather than the full estate administration service, the client may still be legally and financially responsible for the estate, and the provider may not have the level of expertise or knowledge required.
3. Estate administration service
An estate administration service, like that provided by Kings Court Trust, can provide a fixed fee upfront so there’s no concern over the final cost. This service handles all aspects of the estate, including taking on full legal and financial responsibility, providing a dedicated personal estate manager to keep your client updated throughout the process and offering peace of mind with their extensive experience. The main downfall of this approach is that the upfront cost could initially look more than that provided by a traditional provider, even though once the cost is broken down, it is likely to work out cheaper.
If your clients are looking to choose one of these three options, we advise that you ask your clients the following questions to ensure they are clear on the service they are opting for:
Are you paying for probate or full estate administration?
Do you have a clear and guaranteed price to administer the estate?
Are you legally and financially responsible?
If you or your clients have any questions about your options when it comes to the estate administration process, call our Client Services Team by phone on 0300 303 9000 for guidance and advice.