For today’s Life Planning Checklist, your lesson is on probate court.
What is probate court?
Probate court is a nightmare.
Why? For three reasons.
It’s expensive. It’s time-consuming. And it’s all public record.
Probate court is the legal process that happens after a person dies, in which ownership of their assets (property, money or items of value) transfers to someone else.
Most people think it happens like the movies: A lawyer gathers the family and friends to read out a simple document.
Then, the family and friends (presumably) go into the next room to collect their new riches.
That ain’t how it works.
Here’s the most shocking news: If you have a will (that paper the TV lawyer is reading), you actually guarantee that you will go through probate court.
A will isn’t always the best option for passing an inheritance to your kids.
Let’s go over the three reasons why probate court is terrible.
First, there’s the expense. Legal fees are usually 3% of the cost of the estate. If your parents leave you a $300,000 house, that means you’re paying a minimum of $9,000 in fees.
Then there’s the time.
Probate court usually takes about 15 months to conclude. My goal is to get my clients settled within a year.
However, some delays are built into the system. For example, the courts mandate a three-month waiting period to see if anyone files a claim against the estate after it’s published in a newspaper for two weeks.
Plus, there are only so many judges who handle the probate process. Small delays in getting paperwork signed or filed can become long delays if the courts are busy.
And they’re always busy.
Finally, because probate court is public record, it leaves you vulnerable to fraud.
Scammers often use the public filings to file fake claims against the estate. A contractor might produce a contract backdated and “signed” by the deceased for a new $30,000 roof.
Those kinds of claims are hard to disprove. They happen a lot more than you might think, and they lengthen the probate process.
You don’t want to put your family through probate court.
How do you avoid it? Well, I’m glad you asked…
Step 1: Consult with an estate lawyer
Everyone’s circumstances are different. The best option for you and your family may not be immediately obvious.
Estate lawyers will work with you to come up with the best plan to transfer assets to your trusted loved ones. My personal goal is to help you avoid probate court.
My consultations are free. Give me a call, and let’s create a plan: (954) 755-7803.
Step 2: Consider a Lady Bird deed
For many families, the house is your most valuable asset. If your house is in Florida, you can easily keep it out of probate court with what’s called a Lady Bird deed.
To do that, we name your trusted loved one right into the deed of the property. When you die, the house goes to your named beneficiary, without the involvement of probate court.
Easy and simple.
Step 3: Make your intentions clear
Whether or not you’ve set up a plan for transferring your assets, be kind to your family by communicating your intentions.
Before an unexpected tragedy robs you of that chance.
An Estate in One Place account organizes all the paperwork that runs your life. It helps outline your assets so your loved ones aren’t left in the dark.
Even if you’re not ready to commit to an estate plan, Estate in One Place is a good starting place.