Avoiding Probate

When you die, your estate goes through a process called probate which manages, settles and distributes your property according to the terms of your will. Items that are subject to probate are called "probate assets" and can include any property you owned at the time of your death that passes to your beneficiaries. Most wills have to be probated. In general,

Probate can tie up property for months (sometimes even years, depending on the size of your estate and where it is probated). When your family needs income, they should not have to wait months or years for the resources they need. Also, going to probate court is an extremely expensive process. Attorney and court fees can rob an estate of 5% of its value. Probate costs can also include publication costs, executor's fees, bond premiums and appraisal fees. The larger the estate, the greater the probate costs.

Avoiding probate is easy if you plan ahead. It is important that you understand how to avoid probate and that you take the necessary steps to pass your property directly to your heirs. To lower costs for your estate administration and minimize frustration among your family, read our tips below.

Options Available to You

You can arrange to have property transferred to an on death beneficiary or a pay on death beneficiary. You can choose someone to be a on death beneficiary or pay on death beneficiary of your vehicle titles, financial accounts and in some states, your real property. If you would like to prevent your family members from having to go to probate court, there are several effective measures you can take:

• Giving away property now allows you to avoid probate because if you don't own it when you die, it won't have to go through probate
• Name a on death beneficiary on each of your vehicles (visit the DMV in order to make these arrangements)
• If you hold your valuable property in a trust, after your death, the trust property is not part of your probate estate
• You can make your retirement and bank accounts payable-on-death accounts (you must fill out a form and give a beneficiary). This way your money will go directly to your beneficiary. For more information about payable-on-death bank accounts, check out Inc.'s article here.
• List a on death beneficiary or pay on death beneficiary on any of your retirement savings, CDs, annuities or any other investments you have
• Joint ownership can help your family avoid probate. You can either choose joint tenancy with right of survivorship, tenancy by the entirety or community property with right of survivorship.
• There are other shortcuts you can consider if you own a small estate. If your estate is small, the people who inherit your personal property can skip probate entirely. There is also a more simple version of probate possible for small estates. All of these conditions depend on the size of your estate and the state that you live in as each state has different laws.

It is a wiser move to avoid probate altogether, however, another option is reducing your property that will be subject to probate. An estate plan can be designed to limit the assets that pass through probate or to avoid probate completely. To find out more and to craft an estate plan that is best for you and your family's future, consult with a qualified probate attorney today!

Keep in mind that going through probate can be a short and inexpensive process and that often, it does not make sense to plan around it. There are actually even benefits from probate (check out our Probate page to find out more). Speak with a legal professional before taking any direction with your estate plan.