Probate is the legal procedure for handling a deceased person’s estate. This process can be time-consuming and costly. It can also expose sensitive details about your family to the public.
Fortunately, there are several strategies you can use to sidestep probate and ensure the smooth transfer of assets to loved ones.
Using a living trust
A living trust allows you to transfer ownership of assets to the trust while you are still alive. By doing this, the assets within the trust do not need to go through probate upon your passing.
Instead, you distribute them directly to your chosen beneficiaries according to the terms you have established in the document. This arrangement requires you to name a trustee to manage the trust, which can be a person, multiple people or a business entity.
Owning assets jointly with your beneficiaries
Another way to bypass probate is by jointly owning assets with your intended beneficiaries. If you assign rights of survivorship to your joint owner, your stake in the property automatically transfers to that individual upon your death.
You can use this technique with various types of assets, including real estate, vehicles and bank accounts. However, be aware of potential drawbacks, such as the potential to lose control over the asset due to your exposure to the joint owner’s credit or legal issues.
Using payable-on-death designations and transfer-on-death deeds and registrations
Payable-on-death designations let you assign beneficiaries who will inherit the funds in a bank account upon your death. You retain full control of the funds while alive, but they pass without issue to the beneficiary when you die.
Similarly, transfer-on-death registrations allow you to name beneficiaries who will automatically inherit other specified assets. In Oklahoma, this applies to securities and vehicles. For real estate, you can set up a transfer-on-death deed. Another name for this is a beneficiary deed.
With any of these estate planning strategies, it is wise to regularly review and update designations to ensure they reflect your current wishes. By choosing the appropriate options, you can help your family alleviate the stress and expense that comes with the probate process.