How to Avoid Probate
Since the beginning of time, attorneys have been pleading with clients to implement a thorough and complete estate plan to avoid probate. They know through experience how much simpler and streamlined an estate administration handled outside of the probate court is compared to one that goes through it.
You’ll want to avoid probate because it’s:
- Costly
- Time-consuming
- Public (open to creditors)
Losing a loved one is hard enough without hiring attorneys, assembling documents, and gathering the signatures necessary to start the probate process. To avoid a cumbersome probate, you should work with your attorneys and trustees to ensure that all of your assets have been placed into the proper trusts. In doing so, it is not uncommon for you to need to contact your financial advisor or to visit your bank to change the beneficiary of an account or to add a “Transfer on Death” beneficiary. It is of vital importance to follow through with these tasks. If just a single account is not addressed, it is going to lead you to the probate court!
Real-World Example
Mr. and Mrs. Jones had met with their estate planning attorneys to sign their documents in which their trust was to be designated the Transfer on Death (“TOD”) beneficiary for their three bank accounts. The Joneses had a checking account (with both Mr. and Mrs. Jones on the account), a separate savings account for Mr. Jones, and a separate savings account for Mrs. Jones.
After signing the documents, the attorney instructed them to go to the bank to designate the trust as TOD beneficiary. Mr. and Mrs. Jones did this for their joint account. They did not get around to adding the trust as the TOD beneficiary to their own individual savings accounts.
Unfortunately, Mr. Jones unexpectedly died shortly after signing the documents. The joint account he shared with his wife was unaffected, as she was the joint owner and was still living. However, Mr. Jones’ individual savings account had no beneficiary listed, meaning the account became an asset of Mr. Jones’ estate.
Try as she could, Mrs. Jones was unable to get access to her late husband’s savings account funds. Instead, she was told by everyone, including the bank manager and her attorney that she needed to go through probate to access them. As such, Mrs. Jones reached back out to her lawyer to start a lengthy process that could have been avoided by a 10 minute trip to the bank.
How can you avoid this fate? Use our Asset Trust Organizer™ (ATO), a systematic tool that helps our clients stay organized to ensure estate plan assets are fully funded. Since 2005, our clients have used the ATO to identify, organize, and track all of their assets.
The result – Peace of mind that everything is taken care of.
