When a person in Williamsville is going through the estate planning process, an essential focus of that may be avoiding probate. Probate is the legal process your estate goes through if you do not have a will. Probate laws dictate who will inherit your estate should you pass away without a will, which may not align with your preferences. For this reason, many people want to avoid probate altogether. The following are some estate planning strategies that can help you avoid probate.
One way to avoid probate is to give your assets away during your lifetime. This may have the added bonus of reducing the size of your estate to a “small estate” that bypasses probate. Gifts also give you the bonus of seeing your loved ones enjoy their inheritance while you are still alive.
Execute a trust
A trust is a legal instrument used to pass your assets on to your beneficiaries. You will transfer your assets to the trust, thus funding it. Once the titles to your assets are in the name of your trust, they will be overseen by a trustee. Who is trustee depends on whether the trust is revocable or irrevocable. In a revocable trust you can serve as trustee and can change the terms of the trust as you wish during your lifetime. In an irrevocable trust, the terms of the trust cannot be changed, and the trust will be entirely in the hands of the trustee. Either way, once you pass away, the assets in your trust will pass directly to the trust beneficiaries bypassing probate altogether.
Payable on death accounts
Certain financial accounts can be designated as payable on death accounts and will avoid probate altogether. For example, a bank account can be designated as a payable on death account and upon your death will be transferred to your designated beneficiary. Oftentimes real estate is titled as payable on death.
No matter how you decide to handle your assets, avoiding probate should be considered. Probate can be a lengthy, costly and emotional process. Some people find it is better to avoid probate altogether. With the right help you can decide on estate planning strategies that meet your best interests.