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How can you avoid probate?

On Behalf of | Apr 18, 2024 | Estate Planning

Probate, the legal process of validating a will and settling an estate, can be time-consuming, expensive and emotionally draining for your loved ones. Fortunately, there are several strategies you can employ to avoid probate and ensure a smoother transition of your assets to your beneficiaries.

Understanding your options helps you craft a more comprehensive estate plan.

Establish a living trust

One way to avoid probate is to create a living trust. A living trust is a legal entity that maintains your assets during your lifetime and then transfers them to your designated beneficiaries upon your death. By placing your assets in a trust, you effectively remove them from your estate, thereby avoiding the probate process altogether.

Utilize joint ownership

Another way to avoid probate is through joint ownership of assets. When you own property jointly with another person, such as your spouse, the asset automatically passes to the surviving owner upon your death. This process, known as the right of survivorship, bypasses probate entirely.

Designate beneficiaries

Many financial assets, such as life insurance policies, retirement accounts and bank accounts, allow you to designate beneficiaries. By naming specific individuals as beneficiaries, these assets get transferred directly to them upon your death, avoiding the probate process.

Gift assets during your lifetime

If you have assets that you do not need during your lifetime, consider gifting them to your loved ones while you are still alive. By transferring ownership of these assets before your death, you can reduce the size of your estate and potentially avoid probate altogether.

Proactive and mindful estate planning makes things easier for your loved ones when it comes to the distribution of your assets. Consider these tips to reduce your risk of probate.