After the death of a loved one, the last thing you want to be forced to devote time and energy to is figuring out how to navigate the maze of probate. The term ‘probate’ refers to a legal process that is used to divide or dissolve a deceased person’s property and assets (or ‘estate’) when there are questions about its legal standing.
In addition to being frustrating and confusing, the process of probate can be a needless drain on finances at a time when a family’s resources are stretched to the limit.
The good news is that there are many precautions that can be taken to ensure that your estate (or the estate of a family member of loved one) does not linger in probate for months or even years. With the help of a qualified estate planning attorney, many of these precautionary steps can be completed in days or even hours.
For example, one simple method that can be used to reduce the risk of assets being placed in probate is known as a ‘payable-on-death account.’
Sometimes referred to as ‘Totten trusts’ or ‘informal trusts,’ this type of account is very easy to set up. Your estate planning attorney or financial advisor can provide you with a form that will indicate that you want the contents of a particular bank account, deposit, bills, or notes to transfer to one or more named beneficiary upon your death. In most cases, this transfer can be completed without going through probate.
With these accounts, the named beneficiary has no ownership claim on the assets while the original owner is still living. After the account owner’s death, the beneficiary can claim the contents of the account simply by bringing proper identification to the financial institution. However, up until the time of his or her death, the original account owner retains full access to and ownership of the funds.
For personalized information about payable-on-death accounts or other probate-avoidance strategies, schedule a consultation with your estate planning attorney today.