Avoid probate with estate planning
Many people have a will that directs who is supposed to get their property when they die, but very few people are familiar with the process. Contrary to popular belief, the person you name in your will to administer your estate (called a personal representative) cannot automatically access your accounts or start distributing property. He or she must first start a probate.
The purpose of the probate process is to ensure that proper notice of your death is given, that your debts are paid, and that the balance of your property is distributed according to the directions in your will. The type of probate that you have depends on a variety of factors, such as the size of your estate and the level of direct court supervision needed. For example, if at the time you die the only thing you have to your name is a checking account with $5,000 in it, the probate process is simple and can be completed with little or no court involvement. For people with more assets, the process may be longer and more complex.
If you have heard of probate, you probably heard about the court supervised process, and you probably heard that it should be avoided. This is not true in every case, but the top reasons people choose planning that avoids probate are that probate can be long, expensive, and public. An informal probate typically lasts anywhere from six to eighteen months but can last much longer depending on the circumstances. Assets of the estate may be tied up in the probate for its duration. Probate can be complex and most people choose to have an attorney represent them during the process. A good attorney can make the process easier and faster but it may be costly. Lastly, like most things that happen in our court system, probate is open to the public. For example, a nosy neighbor could view probate documents that show what you owned at your death and who gets it.
There are ways to prevent your estate going through the probate process, but most require professional planning in advance of your death.
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This article is designed for general information only. The information presented here should not be construed to be formal legal advice nor the formation of a lawyer/client relationship.