In the context of estate planning, the term “probate” frequently carries a negative connotation. In fact, financial planners advise many individuals, particularly those with valuable accounts and property, to try to avoid probate whenever possible.
However, the purpose of the probate system is ultimately to protect the deceased’s accounts and property, as well as their family, and in some instances it may even be advantageous. Consider briefly the advantages and disadvantages of probate.
In certain instances, particularly when there is no will, the system ensures that all accounts and property are distributed in accordance with state law. Here are some potential benefits of involving the probate court in the administration of a deceased person’s estate:
1. It provides a reliable procedure for the distribution of the deceased person’s property in the absence of a will.
2. If a will exists, it validates and enforces the wishes of the deceased.
3. It ensures that taxes and valid debts are paid so that the beneficiaries are not left with an uncertain feeling regarding the decedent’s affairs.
4. If the deceased had debts or unpaid bills, probate provides a method for limiting the amount of time creditors have to file claims, which may result in debt discharge, reduction, or other advantageous settlement.
5. Probate can be advantageous for the distribution of smaller estates where estate planning would have been too expensive.
6. It allows for third-party oversight by a respected authority figure (judge or clerk), potentially reducing family conflicts and aiding in ensuring everyone’s best behavior.
Although probate is intended to facilitate the transfer of accounts and property after a person’s death in a fair manner, consider bypassing the process for the following reasons:
1. Generally speaking, probate is a matter of public record, meaning that certain documents, including personal family and financial information, become accessible to the public.
2. There may be substantial costs, such as court fees, attorney’s fees, and executor fees, which are deducted from the value of the assets you intended to leave to your loved ones.
3. Probate can be time-consuming, delaying the inheritance of your beneficiaries for months or even years.
4. The probate process can be difficult and stressful for the executor and beneficiaries.
The Bottom Line
Probate is a default mechanism that ultimately enforces fair distribution of even small amounts of money and property, but it can be costly and time-consuming. For this reason, many individuals prefer to use strategies to avoid probate when they pass away.
A skilled estate planning attorney can devise a plan to help you avoid probate and make life easier for your heirs. Contact us today to schedule a consultation and receive more information about your options.