A will is one of the more popular estate planning methods, primarily because creating a last will and testament is relatively easy. What you may not realize, however, is that a will does not bypass the probate process. It almost guarantees it.
Probate is the legal process of distributing a person’s estate upon their death. It involves validating the will. While the will should indicate how you want to distribute your assets to your surviving beneficiaries and heirs, it does not prevent conflict. Probate gives your heirs and beneficiaries the time and avenue to challenge the validity of the will.
People with larger estates might want to consider other estate planning tools to protect their loved ones.
You can create a living trust
You can merge your properties and assets into a living trust. A living trust is a sheltered entity that enables you to manage your estate while you are alive and transfer control of the estate to a successor trustee when you die. The person you assign as your successor trustee will oversee your trust’s financial and legal requirements, including settling debt and taxes and paying creditors. They will also distribute the income and assets from your living trust to your designated beneficiaries according to your explicit trust instructions.
Joint tenancy with rights to survivorship
In North Carolina, you can co-own a property through joint tenancy. You can acquire real estate, vehicles, bank accounts and other valuable financial assets and own them with one or more joint tenants. The property will automatically transfer to the surviving owners with rights to survivorship when one joint tenant dies. An instrument of conveyance can also allow you to divide ownership shares to your liking, meaning your surviving joint tenants may or may not receive equal shares.
Payable-on-death designation
You also have the option to add a payable-on-death designation to your bank accounts, allowing you to designate a beneficiary to inherit all the money in the specific bank or savings account. You do not even have to tell the beneficiary. They will automatically receive your money upon your death.
You can go about estate planning in many ways. You should know which estate planning tools work best for you and your surviving loved ones.
