When you pass away, not all assets are treated equally. Some of your assets, such as real estate and automobiles titled in your name will have to go through the probate process. This can cause stress, hardship, and delay in payment for the individuals put in charge of your estate. If you are concerned about your family immediately being able to control assets upon your death, here are three assets you may already have that can avoid probate.
1. Joint With Right of Survivorship Bank Accounts
A bank account opened with someone else who jointly holds a right of survivorship will avoid probate administration. This is because the account will transfer on death solely to the other person on the account. A joint with right of survivorship account will permit the other account holder the immediate ability to access funds that may need.
2. Life Insurance
Life insurance will avoid probate administration so long as the beneficiary isn't the deceased. A life insurance policy is one that is payable on death to someone. However, if a policy names the deceased as the beneficiary, the policy will be considered an estate asset and therefore subject to probate. If is wise to keep your beneficiaries updated every year and modified after events such as births and marriages.
3. Retirement Accounts
Like life insurance accounts, retirement accounts naming beneficiaries other than the deceased will avoid the probate process. For employer retirement programs, a discussion with human resources may clarify what needs to be done in order to name individuals beneficiaries.
*It should be noted that placing all of your assets in the above-mentioned accounts may not be a wise decision. Probate is simply one obstacle in family wealth planning, but there are more. Creating a family wealth plan with an expert can help in ensuring that your family’s assets are organized in a matter that not only reduce time probate, but also minimize tax consequences and provide stability for your unique needs.Share
When you pass away, not all assets are treated equally. Some of your assets, such as real estate and automobiles titled in your name will have to go through the probate process. This can cause stress, hardship, and delay in payment for the individuals put in charge of your estate. If you are concerned about your family immediately being able to control assets upon your death, here are three assets you may already have that can avoid probate.
1. Joint With Right of Survivorship Bank Accounts
A bank account opened with someone else who jointly holds a right of survivorship will avoid probate administration. This is because the account will transfer on death solely to the other person on the account. A joint with right of survivorship account will permit the other account holder the immediate ability to access funds that may need.
2. Life Insurance
Life insurance will avoid probate administration so long as the beneficiary isn't the deceased. A life insurance policy is one that is payable on death to someone. However, if a policy names the deceased as the beneficiary, the policy will be considered an estate asset and therefore subject to probate. If is wise to keep your beneficiaries updated every year and modified after events such as births and marriages.
3. Retirement Accounts
Like life insurance accounts, retirement accounts naming beneficiaries other than the deceased will avoid the probate process. For employer retirement programs, a discussion with human resources may clarify what needs to be done in order to name individuals beneficiaries.
*It should be noted that placing all of your assets in the above-mentioned accounts may not be a wise decision. Probate is simply one obstacle in family wealth planning, but there are more. Creating a family wealth plan with an expert can help in ensuring that your family’s assets are organized in a matter that not only reduce time probate, but also minimize tax consequences and provide stability for your unique needs.