If you choose a last will to direct the distribution of your assets to your loved ones after you pass away, your estate will have to be probated. There could be outstanding debts, and creditors are guaranteed a substantial period of time to seek satisfaction during the probate process. In addition, anyone who takes exception to the will could present challenges before the probate court. Once the court determines that the will is indeed valid, it supervises the administration of the estate.
As you can see, probate provide a procedure and a level of transparency that can be very useful on a particular level. However, there are pitfalls that go along with probate as well. The very fact that it does open a window of opportunity for those who may want to challenge your wishes is in itself one of the reasons why some people choose to avoid it.
Probate can also be expensive, and every penny that is consumed during the probate process is money that would’ve otherwise gone to your loved ones. Exactly how much of your estate will be consumed during probate will vary depending on its overall value and the complexity of the case, but it is not uncommon for probate to consume as much as 5% of the overall value of the estate and sometimes even more.
One alternative to using a last will that transfers your assets outside of the probate process is a revocable living trust. With these trusts you can retain full control of the assets while you are alive and make changes or even terminate the trust if you want to. But after you pass away, the trustee that you choose will distribute the assets in the trust to your beneficiaries according to the instructions you provide in the trust agreement, and any transfers would take place in a quicker and more efficient manner without the many of the encumbrances that go along with probate.
John’s practice focuses on the use of Wills and Living Trusts in Estate Planning to help individuals protect their families and preserve their legacies after their deaths, but his practice also focuses on the critical issues of protecting individuals with dementia or other diminished capacity, assisting individuals in qualifying for Medicaid and other government benefits to offset the costs of long-term care, and providing special needs planning.
John is admitted to practice law in North Carolina, South Carolina, Kentucky, and Ohio, and he is accredited by the Department of Veterans Affairs.
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