How Can You Avoid Probate?

How Can You Avoid Probate?

Ways to avoid probate include implementing revocable living trusts, gifting property and having joint ownership with another individual, according to Another way to avoid probate is having payable-on-death accounts.

Living trusts were implemented to allow people to avoid probate. Valuable property is held in trust, and when the individual passes away, that property is not part of an estate, according to Nolo. This is because the trustee, not the individual, owns the trust property. The trustee then disburses the property to the beneficiaries.

Bank accounts and retirement accounts can be converted to payable-on-death accounts by listing a beneficiary. When the account owner dies, the money goes directly to the beneficiary without first going through probate, states Nolo. Security registrations can also be set up this way, and some states allow vehicle registrations to be set up for payable-on-death transfer.

There are a few different forms of joint ownership, and this provides an easy way to avoid probate. The title documents of the property list the joint owner, and when one owner passes away, the property is automatically transferred to the other named owner.

Giving away property while alive helps to avoid probate simply because the individual who passed away no longer owns the property.