Many people overlook probate in the estate planning process (or are even
entirely unaware it exists), which can be a costly mistake.
Probate is the process of verifying the legality of a last will and testament
in court and ensuring that the decedent's wishes are fulfilled. If
those terms are confusing, don't worry—we'll clear them
up in a minute.
Understanding the probate process can help you plan for your estate and
preserve your legacy for future generations.
Terms You Should Know for Dealing with Probate
Before we discuss the ins and outs of probate, let's take a minute
to cover some terms you'll want to know:
- Decedent. A decedent is a deceased person.
- Beneficiaries. Beneficiaries are the people who receive assets from an
estate plan on behalf of a decedent.
- Last will and testament. A vital part of any estate plan, the last will
and testament allows a decedent to allocate assets to beneficiaries if
they pass away or become incapacitated. An individual may also establish
legal protocols like Power of Attorney using their will.
- Trust. An individual can also set aside assets in a trust for beneficiaries.
Unlike wills, trusts can also be used to effectively circumvent the probate
process (this will become important later).
What Is Probate?
Courts want to make sure that, when people pass away, their wishes are
carried out in accordance with a will (if they have on). Probate helps
courts fulfill that goal.
When a decedent dies and leaves assets to beneficiaries like property,
insurance policies (other than life insurance), retirement accounts, family
heirlooms, etc., the court steps in and begins the probate process.
When a person drafts a will, they appoint an executor. The executor helps
the court ensure that the will is followed to the letter, fulfilling the
decedent's wishes. Many individuals appoint close friends or family
members as executors, but an attorney, bank, or trust company can also
fill that role.
To complete the probate process, the executor has to fulfill several requirements,
such as notifying people in the will of the decedent's passing and
working with those individuals to ensure they get whatever assets the
decedent left them.
If the decedent had any outstanding debts, creditors also often play a
vital role in the probate process. The court will typically only award
after creditors have been repaid for any debts the decedent owed them. In other
words, the court may seize assets in the will to repay creditors, and
then distribute any remaining assets among beneficiaries once the debts
Is Probate Good or Bad?
There's no right answer to that question. The intent of probate—ensuring
a decedent's will gets carried out and nobody tampers with it—are
good. However, probate can also be a long, expensive process—especially
if friends or family try to contest the legality of the will.
For this reason, many estate planning lawyers suggest that individuals
put large or valuable assets, like property, in a trust instead of a will.
The probate process doesn't apply to living trusts if it's carried
out correctly, so trusts can be a great way for individuals to ensure
friends or family members get assets without having to go through probate.
If you're like to learn more about drafting a will or trust to safeguard
your legacy for future generations,
contact our office online. We can help you draft a comprehensive estate plan that protects your
assets and liabilities.