You may have heard someone mention that they created an estate plan to avoid probate, but you may be unsure why they did that.
You could be wondering what is wrong with going through the probate process since it is a legal process that includes filing a will, having the court authenticate it and managing your assets according to your wishes.
However, the probate process has downsides that lead many people to create trusts instead as part of their estate plan. Trusts provide many benefits, which we will cover in a future blog post, but let’s delve into why some people choose to avoid the probate process.
What is probate?
Probate is the legal process after someone passes away, where their assets are distributed, debts are settled, and the estate is closed. However, it is not nearly as simple as it sounds, as probate can often be time-consuming, expensive and public.
The probate process is lengthy
Going through probate can take months to years, depending on what the decedent left behind, how many beneficiaries there are, and the relationships between them. There can also be lengthy conflicts between beneficiaries who want to claim more of the estate.
The probate process is expensive
Probate is costly because it involves paying court, attorney, and executor fees, which add up over time. Prices can increase exponentially, especially if a will is contested or challenged.
The probate process is public
Anyone can access the records and details of an individual’s estate if they go through probate.
This lack of privacy makes many families very uncomfortable, particularly families who prefer to keep their financial affairs confidential.
Avoiding probate allows you to keep all details of your estate and its distribution and closure confidential, including the names of your beneficiaries.
The probate process is available for everyone, which is positive because not everyone has access to or the financial means to deal with their estate plan privately.
However, for those who do and who wish to avoid some of the downsides of probate, avoiding the probate process may be the perfect answer.
