You might have heard people talk about their loved one’s wills going through probate. You might also have heard people saying how they are taking specific estate planning actions to avoid their estate passing through probate.
If you are thinking about making your first estate plan, then you might be left wondering what probate is and whether it is a good thing or something to avoid.
Consider it as a series of checks
When you write your estate plan, you should name an executor, They are the person who will take charge of distributing your estate as per your wishes and any relevant laws. To do this, they will need to run things by a probate court. Only once the probate court is happy that everything is in order, will they be free to distribute the assets as you asked them to. The court will make sure they abide by legal obligations, such as settling debts with creditors. It will also make sure the person is fit to act as executor and that the will is valid.
So you could view probate as being a safety mechanism to help make sure your executor does as they should. It reduces the chance of errors slipping through or of a dishonest executor exploiting your estate at a cost to your intended beneficiaries.
The downside to probate is that it takes time, often just a few months, but possibly years in complicated cases. That’s a time when your beneficiaries won’t have access to the things you left for them. Secondly, there is a cost to it, although it’s not exorbitant. Some people, therefore, prefer to avoid probate altogether by placing their assets in trusts or other financial tools that won’t have to pass through probate.
With so much at stake, it’s wise to learn more before putting pen to paper on your estate plan.