Probate: What It Is? How To Avoid It? — Part 2

Creating an estate plan that effectively keeps your family out of court is crucial. If you don’t, many of your assets may have to go through probate, a time-consuming, costly, and public process. Last week, we explained the probate process, and now, in part two, we'll delve into its drawbacks and how to avoid it.

Probate court proceedings can take months or even years, causing significant stress and financial strain for your loved ones. Without immediate access to your assets, they could face serious hardship, potentially depleting your estate through legal and administrative expenses. Moreover, probate proceedings are public, exposing your estate details to potential scammers and frauds.

Additionally, probate can fuel conflict among your heirs, especially if your estate plan is contested. Fortunately, there are ways to avoid probate.

Certain assets, like those with beneficiary designations, bypass probate. These include retirement accounts, life insurance proceeds, and payable-on-death bank accounts. Assets with a right of survivorship, such as joint tenancy property, also avoid probate.

However, assets without beneficiary designations or joint ownership require more advanced planning. A revocable living trust is a popular tool for probate avoidance. This trust agreement transfers assets to a trustee for the benefit of beneficiaries, ensuring a smooth transition of assets outside of probate.

Unlike a will, a trust enables immediate asset distribution, offers greater control over distribution terms, and protects assets from creditors. However, proper trust funding is essential to ensure it functions as intended.

While a living trust does not affect income taxes or protect assets from creditors during your lifetime, it safeguards assets for your beneficiaries. To determine the best estate planning strategy for your family, consult with us for a Planning Session. We’ll analyze your assets, goals, and family dynamics to create a customized plan that ensures your loved ones are protected and your legacy is preserved.

This article is a service of Zarda Law, S.C. We do not just draft documents; we ensure you make informed and empowered decisions about life and death, for yourself and the people you love. That's why we offer a Planning Session, during which you will get financially organized and make the best choices for the people you love. You can begin by scheduling aPlanning Session and mention this article to find out how to get this $750 session at no charge.