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A thoughtful estate plan may be able to help you prevent probate, but sometimes it’s just necessary. Most people turn to estate planning as a way to ensure that their legacy is distributed to future generations of loved ones in the manner they so wish. The documents within an estate plan will instruct how the deceased wants their assets accumulated over a lifetime to be handled after passing on. The probate process may get a bad reputation, but it is a reality many families may face. If you are looking for tips on how to navigate probate, then read on.
Probate is a proceeding overseen by the court, where the assets of someone who recently passed away are retitled in the name of their heirs. This process entails validating a decedent’s last will, transferring assets to heirs, and confirming that debts are paid from the estate. Probate is a way for assets to be officially given from one person who died, to a beneficiary or heir. Probate can be tedious and prolonged, or handled quickly and efficiently, it will just depend on the decedent’s estate and whether they had written any estate plan documents beforehand.
Assets that may go through probate can include vehicles, household items, finances, property, and others. If someone passes away without a will, then the laws of intestacy for that state come into effect. The property under probate is all property held individually and was not given a beneficiary designation. Examples of assets that may not be part of the probate process are listed as followed:
- Transfer-on-death accounts
- Pay-on-death accounts
- Trust property
- Property as joint tenancy with survivorship rights
- Property as tenancy by entirety
- Annuities with chosen beneficiaries
- Retirement funds with chosen beneficiaries
- Life insurance policies with chosen beneficiaries
As a probate lawyer at W.B. Moore Law explains, the probate process can be long and may take several years to finalize in some cases. Probate is set up in a way that aims to reduce risk of committing errors, but the downside is that it can be time-consuming due to the degree of procedure involved. This process can be particularly frustrating for those who are rightful beneficiaries and don’t want to wait months or years to get their inheritance. Furthermore, probate can be expensive, the average case costs between 5%-10% of the estate in fees and administrative costs. Other fees could include compensation for an executor, fees for filing paperwork, probate bond, and more.
How you can avoid probate will depend on your individual circumstances and goals for the future. But examples of estate planning strategies that can help you prevent your assets from probate is by establishing a payable-on-death account, living trust, transfer-on-death account, or transfer-on-death deed, among others. Another thing to consider is the fact that probate is a public proceeding. Many people prefer to create an estate plan that allows assets to be smoothly distributed outside of probate and without the public being privy to their personal information.
