3 Ways You Can Ensure Your Loved Ones Avoid Probate After You Pass Away
Most people don't like to think about death. However, if you have considerable wealth and assets, you need to think about what will happen to them after you pass away. Generally, after someone passes away, their estate goes through a process called probate. Probate is simply the court validating the deceased person's will. This can take weeks or even years if your loved ones contest the will. The good news is there are ways around probate. Here are three ways you can ensure your loved ones avoid probate after you pass away.
1. Joint tenancy.
When it comes to your real estate assets, if you want to ensure your loved ones have immediate ownership of the property after you die, you need to establish joint tenancy. You don't have to be married to the person in order to make them a joint tenant of the property.
You will need to create the joint tenancy and, after you pass away, your share of the property will immediately transfer to the joint tenant without the need for probate. In order to get the property solely in the joint tenant's name after you pass away, they usually just need to take in a copy of your death certificate and fill out a form.
2. Revocable living trusts.
Another way to keep your assets from going through probate is to create a revocable living trust. When you do this, you will create a trust where you are the trustmaker, trustee, and the beneficiary. You will need to name a successor trustee and the ultimate beneficiaries when you make the trust agreement. After the trust is created, you will fund it with whatever assets you choose.
While you are alive, you are the only one who has access to the trust. But, because your assets are no longer in your name, the assets in the revocable living trust will not have to go through probate after you die. Instead, the successor trustee will take control of the trust and use it to pay any outstanding debts of yours before finally distributing the rest of the assets to your ultimate beneficiaries.
3. Pay on death account.
If you want to make sure your loved ones have quick access to your bank account after you die, you need to make it a pay on death account. Some people think that it is better to create a joint bank account instead, but the big drawback to doing that is the other person has access, and a right, to your money while you are still alive. That means they can spend it at any time and leave you with nothing.
However, a pay on death account makes it to where the other person only gets access to the bank account funds after you have passed away and they have presented the bank with an official death certificate. Since you designated someone to get the balance of your bank account upon the event of your death, the money doesn't get tied up in probate.
For more estate planning question, contact an attorney like those at the Law Office of Tara L. Wolff.