Estate planning is an important aspect of dealing with assets after a person dies. One significant advantage of it is its ability to help individuals sidestep probate.
By crafting an estate plan, people can safeguard their assets and spare their heirs the headache associated with probate. Otherwise, the probate process can take months or even years to complete and may lead to significant expenses.
Living trust
A living trust is a big component of many estate plans and offers a powerful tool for avoiding probate. By transferring assets into a trust during their lifetime, individuals can ensure that those assets do not go through probate upon their death.
Since the court considers assets held in a trust separate from an individual’s estate, they can go directly to beneficiaries without the need for court supervision.
Beneficiaries for certain assets
Another way to avoid probate is by designating beneficiaries for certain assets. Assets such as retirement accounts, life insurance policies and payable-on-death accounts transfer to beneficiaries upon the individual’s death. By doing so, these assets bypass the probate process entirely.
Joint ownership with rights of survivorship
Joint ownership with rights of survivorship is another strategy that can help individuals avoid probate. When a person owns property jointly with someone else, such as a spouse or family member, and includes rights of survivorship, ownership of the property automatically passes to the surviving owner upon the other owner’s death. This transfer occurs outside of probate.
Estate planning allows individuals to avoid probate if they know where to look and what to do. Taking the time to craft a comprehensive estate plan today can offer peace of mind for everyone involved.