What Steps Can I Take To Avoid Probate?


Video Summary

What steps can I take to avoid probate?  Well, the quick answers for a lot of lawyers to offer to this is to set up a trust.  However, I have a little brochure that I pass out that’s called Simplified Estate Planning without the Necessity of a Trust in Order to Avoid Probate.

So you first have to look at the nature of your assets.  For example, if you have a life insurance policy it needs a beneficiary so that doesn’t go through probate ‘cause it’s controlled by the terms of the life insurance policy.

That’s the same that’s true about individual Retirement Accounts or IRAs.  You have a designated beneficiary so you don’t have a probate proceeding as far as IRAs, and that can also be said for annuities because the annuity contract will designate who’s to receive the death benefit or the benefits after the initial annuitant passes away.

When we turn to bank accounts, I suggest that you keep the bank accounts in your individual names and designate a payable on death for whomever you would like to receive it upon your death.

So the other designation is In Trust For or ITF account.  If you put someone on account as a co-owner, so if you’re by yourself and you put your son or daughter on the account with you, they become a half owner of the account and it could be subject to the claims of their creditors if they get in financial problems or domestic problems, being considered an asset in a divorce proceeding.  So I suggest that you simply designate a POD account or an ITF account for the benefit of that child or whoever you’d like to receive it and that will avoid probate.

One of the big sticking points is what do I do about real estate, particularly your home.  Well, what I have been doing is to prepare what they call a Life Estate Deed, whereby you convey your property to your child or children or whomever you would like to have it upon your death.  However you reserve all rights on the property during your lifetime.  You’ve reserved the right to sell the property and retain the assets.  Sometimes this is called a Ladybird Deed, and this again avoids probate.

And if you want your assets to be spread out over a period of time, let’s say you need a Special Needs Trust or a Spendthrift Trust for a child or a loved one that you want to care for, then certainly a trust is another way of doing it, although there may be a trust administration involved.

So those are some of the examples of how to avoid probate, is how you title your assets.  So if you’re interested in doing that give me a call at 727-847-2288.  Thank you.