If you have a Will or are thinking of preparing one you must understand how a will works after you pass away. The probate process is neither cheap nor quick. It can take from several months and can go on for years after you have passed on. There are several steps in the probate process. Your states Probate Court will control the process. Probate courts around the country all pretty much follow the same basic processes and steps, which typically include:
- Filing the deceased person’s will with the local court
- Notifying heirs, creditors, and the public that you are, indeed, dead
- Identifying and inventorying the deceased person’s property
- Having the property appraised
- Paying off all debts, including estate taxes, if any
- Having the will “proved” valid to the court
- Distributing your estate
The cost of probate may include appraisal costs, executor’s fees, court costs, the costs for a type of insurance policy known as a surety bond, legal fees, and accounting fees. When you add it all up, probate can cost from 3 percent to 7 percent of the total estate value. And if your estate includes property in more than one state, it may be subject to separate probate proceeding in all applicable states.
It is said that the reason for having such a lengthy and costly process is to prevent fraud in transferring property and to protect inheritors by promptly resolving claims creditors have against a deceased person’s property. The reality is that most property is transferred within a close circle of family and friends and very few estates face potential fraud or creditor claims. Most people have no need for probate’s so-called benefits. Probate is often categorized as an expensive time-wasting process.
As an alternative to probate there are many legal methods to avoid probate entirely. Because bequeathing property in a will usually results in probate, probate-avoidance strategies should be implemented. The most common probate-avoidance methods are:
- Revocable living trust
- Joint tenancy and tenancy by the entirety
- Payable-on-death designations
- Life insurance
- Gift Planning
Keep in mind that these probate-avoidance methods can and should be used together as part of an estate plan. You should already have a pretty good idea of what your estate is worth so that you can make intelligent choices for your estate plan. Remember that what is right for one person may not be right for everyone. Obtain a plan specific to your situation and needs by visiting your attorney. Make sure that you take the necessary steps today so that in the future you make a difficult time easier for your loved ones.
