Not all assets are subject to probate proceedings. Generally, assets with a beneficiary, held in joint tenancy, or belonging to a trust will avoid probate. In each case, you have a contract in place that designates who is to receive that particular asset. Therefore, the court does not need to make sure these assets are distributed to the right individuals.
Specific examples of assets that avoid probate are individual retirement accounts, 401(k)s, life insurance policies, annuities, a personal residence held in joint tenancy or as husband and wife with right of survivorship, pay-on-death (POD) or transfer-on-death (TOD) accounts and, of course, assets held in a living trust.
Avoiding probate is a wonderful thing if you value privacy, money and expediency. First, probate is a very public process so anyone can view the estate documents filed with the court, including the will. Second, probate is a costly process, the fees for which are based on the value of the estate. Third, probate can take anywhere from four months to a year or more.
The Takeaway: There are many estate planning tools available to avoid unnecessary or unwanted probate proceedings that can save you and your heirs a lot of time and money!
If you have estate planning needs, please contact me to take advantage of a complimentary consultation. I can be reached at 415.235.9162 or at firstname.lastname@example.org.