Preparing your estate can be intimidating. When taking this step, the person should know that the Last Will and Testament is not a stand-alone document that allows for assets to be retitled and distributed without having to go to probate court. In most cases, a Last Will and Testament is only an instruction piece for the judge in your probate matter to consider.
Probate is a court-supervised process for distributing the assets of the person who has passed away, also known as the decedent. Probate can be tricky, expensive, and incredibly lengthy. The good news is that there are mechanisms that you can put in place so that your assets pass directly to your intended beneficiaries without having to go through probate.
Here are three things you can do to minimize the likelihood of your heirs requiring probate upon your passing.
1. Living Trusts
A living trust is a legal document where a designated person. Also, known as a trustee. It is given responsibility over certain assets for the benefit of easy transfer after death. These trusts must be created before your death, and you will be the trustee until your passing when the intended beneficiary will become the trustee and gain control of the assets. This requires no probate or court appearances and can be a simple transition.
2. Enhanced Life Estate Deed (Lady Bird Deed)
An enhanced life estate deed, commonly known as a “Lady Bird Deed,” is a document that transfers property to one or multiple beneficiaries while the owner is still alive. The enhanced life estate deed allows for the owner to continue living in or using the property and make decisions about the property, such as the decision to transfer or sell, without the consent of the beneficiaries. Compare this to the standard life estate deed, which does not allow for the owner to transfer or sell without the consent of the beneficiaries. The Lady Bird Deed is currently recognized and accepted in five different states including Florida. Another key benefit of this deed is that the maker of the Lady Bird Deed can undo it at any time.
3. PODs or TODs (Payable on Death and Transfer on Death)
In the State of Florida, residents can add a payable-on-death or transfer-on-death designation to their bank accounts, retirement accounts, investments, and insurance policies. If this was done and recorded with the company holding the account or policy, the designated beneficiary would just have to show proof of the original owner’s death to automatically transfer to the beneficiary without having to go through the probate courts.
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