Probate is a legal process that happens after someone dies. While it may be necessary in some cases, it has potential drawbacks, which is why many individuals seek to avoid it.
Why you might want to avoid probate
Avoiding probate may offer benefits for you and your loved ones. These may include:
Saving you time
Probate proceedings often take months or even years to complete. This delay could be particularly challenging for beneficiaries needing immediate access to inherited assets.
Saving you money
Probate can be expensive. Court fees, attorney costs and executor compensation could significantly reduce the estate’s value. By avoiding probate, you may be able to preserve more of your assets for your beneficiaries.
Maintaining your privacy
Probate proceedings are matters of public record. This means that details about your assets and beneficiaries may become accessible to anyone who wishes to view them. Avoiding probate could help maintain your family’s privacy during a challenging time.
Strategies to help you potentially avoid probate
Below are strategies you might consider to avoid probate potentially:
Create a living trust
Consider transferring your assets into a living trust. It could allow you to maintain control of them during your lifetime while ensuring they pass directly to your beneficiaries upon your death, bypassing probate.
Use joint ownership
Certain forms of joint ownership, such as joint tenancy with the right of survivorship, may allow the property to pass automatically to the surviving owner without going through probate.
Designate beneficiaries
You could name beneficiaries who will receive the assets directly upon your death. These assets may include life insurance policies, retirement accounts and certain bank accounts
Gift assets during your lifetime
Giving away property while you are alive could reduce the size of your estate and avoid probate for those assets.
Probate laws vary by state. Individual circumstances could impact estate planning decisions. You may want to consider seeking legal advice. An attorney could ensure your estate plan aligns with your needs and goals.