Probate is a term readers have probably heard at some point. The term refers primarily to the process of establishing the validity of a will, but also refers to the process of administering the will. Probate defaults as a court-supervised process that involves expenses and takes a certain amount of time. In cases where disputes arise or estate documents are not in order, time delays can be significant.
In addition, probate is a public court proceeding and opens up family disputes to public exposure. If disputes arise in the probate process and the family cannot agree on how to resolve the matter—a rather frequent problem—the judge has to step in and make a decision. This takes control out of the hands of the deceased individual whose will is being administered. In short, it is often desirable to avoid probate, but how do you do so.
One common way to avoid probate is to establish a revocable trust and fund it with real property title, bank accounts, investment accounts, and other assets. Another way is to effectively manage beneficiary designations to ensure that proceeds get to the right person. Beneficiary designations are associated not only with life insurance policies, but also with retirement accounts and annuities.
There are other ways to avoid probate as well, which include lifetime gifting, titling proper with a right of survivorship and making use of payable on death (POD) and transfer on death (TOD) designations where appropriate.
Those who have questions about probate and avoiding probate should, of course, work with an experienced estate planning attorney to have their situation fully evaluated and to determine the best course of action.