Estate Planning Basics
Without a will, the law decides who inherits, and in Germany that often isn't who you'd pick. The documents to set up and what each one costs.
Estate Planning Basics
Here is the uncomfortable version: if you die without documents, a judge you have never met assigns someone to distribute your money, and the people who receive it are decided by a default rule written decades before you were born.
That rule gets it right often enough to feel safe and wrong often enough to end families. For an unmarried couple it is simply wrong — no will means no inheritance, regardless of how many years you lived together or whose name is on the lease.
What happens if you do nothing
Every state has an intestacy statute. It distributes your estate in a fixed order: spouse first, then children, then parents, then siblings. Two features surprise people.
First, "spouse" usually does not mean everything. In many states a surviving spouse with children from the deceased shares the estate with those children — commonly half, sometimes a third. Second, an unmarried partner is not an heir in any state. A partner of twenty years receives nothing and has no standing to contest it.
The four documents
Estate planning for a normal household is four documents and a beneficiary review. Nothing here needs a trust, and nothing here is expensive.
Will
Names who gets what and, if you have minor children, who raises them. Without it a court chooses the guardian.
Durable power of attorney
Lets someone you chose pay bills, file taxes and manage accounts if you cannot. Without it, a court appoints a stranger and supervises them at your expense.
Health care directive and health care proxy
States what treatment you want and who speaks for you when you cannot. Doctors follow this document, not your family's memory of a conversation.
Beneficiary review
Not a new document. A check that the retirement accounts and life insurance policies you already own name the people you think they name.
The last item is the one people skip, and it overrides everything else. A 401(k) or IRA passes to whoever is on the beneficiary form, no matter what your will says. An ex-spouse named in 2014 and never updated inherits the account. Every plan should include a calendar reminder to check those forms every two years and after every marriage, divorce, birth or death in the family.
What probate actually costs
Probate is the court process that validates a will and settles debts. Its cost scales with the size of the estate, and it is paid out of the estate before anyone inherits.
The fee schedule is set by statute, so it is entirely predictable — and it doubles again on a contested estate.
Illustrative. Applies a typical state statutory schedule of roughly 3% of estate value, the most common structure. Actual fees vary by state and by whether the estate is contested.
A $300,000 estate hands $9,000 to lawyers and the court before a single heir is paid. Much of that is avoidable with beneficiary designations and, for larger estates, a revocable living trust — but the trust only works if it is funded, meaning the accounts are actually retitled into it. An unfunded trust is an expensive binder.
Germany does it differently and, for a €500,000 estate, rather more cheaply: the probate court charges €2,250 under the statutory fee table, though a certificate of inheritance adds a multiple of that because the notary and the court both bill against the estate value.
The federal estate tax is not your problem
The US federal estate tax exemption is $13,990,000 per person as of 2025, portable to a surviving spouse. A married couple can therefore pass roughly $27.98 million without federal estate tax. If your estate is smaller than that, you will pay no federal estate tax, and any product sold to you on the grounds of avoiding it is being sold for another reason.
Six states levy their own estate or inheritance tax with far lower thresholds. Oregon and Massachusetts start around $1 million to $2 million. If you live in one of those states, the planning question is real; if you live in Florida or Texas, it almost certainly is not.
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