When someone dies, probate is the process of recognizing the will and appointing the personal representative. Depending on the complexity of the situation, the settlement of the estate can take a lot of time and money.
To save time and expense, some people choose to avoid probate, and there are numerous ways to do so.
According to Money Crashers, the personal representative is the only person who has authority to manage the estate. In most cases, all probate processes follow the same basic steps. The first is to find the will and submit it to probate court to open a new case. After initiation of probate, the personal representative notifies all relevant parties, including beneficiaries and creditors.
Until the completion of probate, the personal representative must continue to manage the estate by paying bills, filing taxes and hiring caretakers. The personal representative must perform an assessment of the estate’s worth. This includes all assets like cash, real estate and personal items. The personal representative may need to sell some of the assets to pay expenses or for wealth distribution. The next step is payment of debts and then distribution of assets.
How to avoid probate
The process of estate settlement can take years, and FindLaw discusses some ways to reduce costs, avoid legal trouble and leave more for heirs. Naming beneficiaries for financial assets takes the accounts out of the estate. One can also avoid probate by forming joint ownership with a right of survivorship.
The owner of the estate can gift assets before death, although taxes apply if the asset costs more than a certain amount. Finally, some choose to open a revocable living trust, in which a trustee holds the property for the owner, effectively keeping it out of probate.