Three Techniques to Avoid Probate

Posted on Jun 28, 2023 by

Probate is a legal process that comes into effect upon your passing, and its purpose is to supervise the fair distribution of your assets to your heirs, beneficiaries or creditors. The process is triggered when your assets are frozen, which basically means that you haven’t designated any beneficiaries nor joint owners who could inherit your property.

The probate process can tie up your assets for up to a year or even longer and, in many cases, can put unnecessary demands on your loved ones at an already difficult time. In addition, it is a public process, meaning that anyone can go to the courthouse to determine what you owned at the time you died, including the value of your assets and how they are being distributed.

If you have a will, it’s essential to understand that this document alone does not avoid probate. In fact, the probate court oversees the transfer of assets via the will. However, there are specific steps that individuals can take to ensure that their assets avoid probate and are passed on smoothly to their intended beneficiaries.

By using these helpful techniques, you can help to ensure that your loved ones can inherit your assets with as little stress and hassle as possible.

  1. Use a revocable living trust for your estate plan instead of a will – again, only having a will does not avoid probate! A will is a legal document that outlines how your assets will be distributed after your death, while a revocable living trust allows you to transfer assets either during life or upon death, in one of the following ways:
      • During lifetime with an assignment, or
      • At death using a “transfer on death” designation, or
      • At death using a martial property agreement

2. List an asset as “transfer on death” (TOD) to your beneficiaries directly. This requires individual beneficiary designations on all of your assets, including:

      • Bank accounts must be set as “payable on death” or POD
      • Investment accounts must be set as “transfer on death” or TOD
      • Life insurance policies should list beneficiary designations
      • Real estate that have a “transfer on death” deed

3. Use a Marital Property Agreement (MPA) to transfer to your beneficiaries directly.

Is there one best option?  No – each option is suitable for different families or estates.  An estate planning attorney will help you decide which option is correct depending on the size of your estate, the different tax laws in place at the time, and the composition of your family and your family’s dynamics.

Please reach out to one of our estate planning attorneys at McCarty Law if you have questions.

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Jon L. Fischer

Estate Planning and Elder Law Attorney at McCarty Law LLP
Jon focuses his practice on estate planning, probate matters, and Medicaid planning as he aims to help clients in their time of need.