If you want to avoid the time and cost involved in the probate process, you’ll need to create a comprehensive estate plan that includes mechanisms specifically designed to avoid probate. Simply having a will is insufficient; a will merely explain how you want your assets distributed. If you only have a will, it still has to go through probate in order for your assets to actually be distributed. Fortunately, however, there are some ways that you can avoid the probate process and still ensure that your assets are distributed in the manner that you choose.
Some assets, by their nature, are non-probate assets, meaning that they provide for a named beneficiary. The beneficiary whom you choose will receive your assets without any need for probate. Assets that fall within this category include life insurance policies, IRAs, 401(k) plans, and some bank or brokerage accounts that are designated as payable on death (POD) and transfer on death (TOD). The only issues with these types of accounts is that you need to keep your beneficiaries updated to reflect your wishes and replace your beneficiaries with successor or alternate beneficiaries if they pass away prior to your death.
Next, you can create a trust and place all of your assets in it. Any assets that are in the trust at the time of your death pass to your designated heirs through a named trustee who administers the trust. You choose the trustee for your trust, who will administer the trust according to the guidelines set forth in your trust document. If you have placed all of your assets in the trust, there is no need for the probate process.
Another way to avoid probate is through the creation of joint accounts. For instance, if you jointly own your bank account with your spouse at the time of your death, your spouse automatically will become the owner of the bank account. This is an easy way to ensure that assets pass to your designated heir outside of the probate process.
The estate planning attorneys of Legacy Law Center are here to help clients navigate through the estate planning process in order to adequately address all of their issues and concerns. With our skills, experience, and knowledge, we can help you make the estate planning decisions that will best benefit you and your family. Contact us at our Ann Arbor office today and find out how we can assist you with your needs.
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