As you approach retirement, there are several tasks to tend to, including estate planning. When preparing these arrangements, remember that there are many advantages to keeping your estate out of probate. For instance, your loved ones will get their inheritance faster since the court won't have to determine the validity of your will, and the executor won't need to locate and valuate assets. By making arrangements to circumvent probate, your estate will also avoid legal fees. The following tips can help you skip this lengthy process.
How to Avoid Probate
1. Establish Joint Ownership
Instead of making a loved one an estate beneficiary, consider jointly owning assets with them. As a joint owner, the property will directly transfer to them after you pass away. You can establish this arrangement by including a "joint tenants with rights of survivorship" arrangement in the deed or title to the property, which can include real estate holdings, motor vehicles, boats, and other valuable items. Joint financial accounts often come with "right of survivorship" terms, where the second person named on the account can access funds after the first account holder dies.
2. Set Up Payable-on-Death Designations
Consider transferring existing bank accounts to payable-on-death (P.O.D.) accounts. Under this formal, legal arrangement, your financial institution agrees to give the person you name as the beneficiary the funds in the account after you pass away. Your intentions are outlined in a Payable on Death or beneficiary designation form, which your bank keeps on file. You can set up this agreement for checking, savings, retirement, and other financial accounts.
3. Create a Revocable Living Trust
A lawyer can help you establish a revocable living trust. Essentially, you relinquish ownership of assets by transferring them into the trust. You serve as trustee or manager of the trust until you die. You can also revoke the trust at any time during your lifetime. Upon death, the person you appointed as successor trustee transfers the property to trust beneficiaries without going through the probate process.
If you'd like help with estate planning, including keeping your estate out of probate, contact Larry J. Keller, Attorney at Law, for guidance. For over 30 years, the Waterloo, IL-based attorney has helped Monroe County clients draft wills and create trusts to minimize tax obligations and help their loved ones get their inheritance quickly. Visit the law firm online to learn about additional services, or call (618) 939-8999 for an estate planning consultation.