Avoiding the probate process is the goal of many people when planning their estate. Going through probate is costly, and these costs are deducted from loved ones’ inheritance.
However, managing to avoid probate completely can be a difficult thing to accomplish. In most cases, people manage to avoid probate when it comes to larger assets that they have set aside into trusts. To understand how you can avoid probate to as great an extent as possible, it is important that you understand under what circumstances an asset will be subject to probate.
Assets will go through probate when they are not transferred over to a trust
When an estate planner sets up a living trust, they are often led into a false sense of security, thinking that they no longer need to invest time into avoiding the probate process. However, additional assets acquired after the living trust was set up will need to be transferred over. When this is not done, probate will still need to be processed in regard to some assets.
Assets without co-owners may face probate
Married couples often implement a co-ownership strategy when it comes to avoiding probate. They do this by making assets such as bank accounts, bonds and real estate in both of their names. This means that the asset in question will not need to go through the probate process if one of the owners dies.
Assets with predeceased beneficiaries
Many assets, such as insurance plans, have payable-on-death designations. When the person listed on these plans passes away before the owner of the plan, it means that the asset in question no longer has a beneficiary. The asset will then become subject to probate.
This is why it is especially important to create an estate plan that can be easily and efficiently managed throughout your lifetime. This will mean minimal stress and can help to ensure that probate on significant assets is avoided.
It is important to conduct thorough research when planning your estate in the state of California so that you can achieve the best result for you and your beneficiaries.