Many of us want to pass on something to our child(ren) or other individuals near and dear. We keep a little here and there to make life somewhat easier for the ones we care about. The last thing someone wants is to give a huge part of their hard earned money to the government by means of probate fees. And we don’t want our loved ones, specifically our spouses and children to wait months, possibly years to collect a penny.
Avoiding delays and expenses of probate is a lot easier than you might think. Here are a couple of basic tips to retain more of your estate in the hands of the individuals that are the most important.
- Create a Living Trust
The most direct way to avoid probate is to merely write a living trust. A living trust is simply another option to a Last Will. Dissimilar to a will, which simply allocates your assets after you pass away, a living trust puts your property and assets “in trust” that are then administered by a trustee for your beneficiaries’ benefit. It enables you to avoid probate completely since the property and assets are distributed to the trust already.
A trust also allows you to avoid the expense of probating a will. A main disadvantage of a will is the expense of transferring it or passing it to the court. In probate, court fees are acquired from the gross estate (the entire estate’s amount prior to debts being paid out). These fees can occasionally be as high as 10% of the entire estate which usually is better utilized paying trustee fees and burial expenses. With living trusts, these court fees are avoided altogether.
- Designate beneficiaries on your bank and retirement accounts
For many, a Last Will is usually a better fit than trusts since it is a more direct estate planning document. Still, just because you have created a will does not mean that all of your assets will go through probate. What a lot of people don’t understand is that some of our most valuable assets allow us to designate beneficiaries. Fact is, you might not have realized that the account you opened when you first started working most likely allows you to designate a beneficiary that is payable-on-death.
Although it might seem straightforward enough, a lot of people do not take the time to actually designate a beneficiary and/ or beneficiaries for their financial institute accounts, capital and retirement plans. POD accounts comprise of life insurance policies, 401K’s, pension plans, IRA accounts, along with stocks and bonds.
All you’re required to do to get started is to petition and fill out the POD forms provided by your bank or brokerage company. Don’t forget, if you’re married, many of these accounts automatically can be somewhat owned by your spouse. By making time to fill out the forms, nevertheless, you guarantee that the capital is immediately dispersed at death devoid of going through probate – saving a great deal of time and loads of expense.
For some, a Last Will can, therefore, be a perfect option to a Living Trust.
- Joint Tenancy with a Right of Survivorship
One other ideal way for keeping the real estate out of probate is to think about jointly holding the property. If you and your spouse or partner are contemplating about buying your first home or possibly already own your own home, jointly owning allows the property to pass automatically to them without needing to go through probate. It does not matter if you’re married or not. When the property is designated as a jointly held property it will go to the surviving member of the couple. Needless to say, you’ll want to guarantee you declare this ownership unequivocally. You might also want to explore Tenancy by the Entirety and as a married couple in Community Property states you’ll want to look into designating joint-ownership property as Community Property with a Right of Survivorship.
Are you ready to begin your estate plan?
This list is in no way comprehensive. Many states even provide an accelerated probate for what they think of as “small estates.” Certainly, you’ll want to examine your states laws for what they think a small estate is. Usually this designation may signify that an estate is less than a specific amount or it may mean that there isn’t real property for the court to look at.
A lot of the time we just need a tiny nudge to actually start the process. And, there’s no time like now to get started.
Need an Affordable Living Trust Lawyer in Scottsdale?
Moshier Law should be your choice when you need the best will lawyer in Scottsdale. An experienced family law attorney will work with you to obtain the best possible outcome in your situation. We advocate for our clients so they have the brightest future possible. Give us a call today at 480-999-0800 for a free consultation.
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