As you work on estate planning activities, you may start to become aware that your loved ones will have to go to probate court after you pass away. In order to avoid that, you need to make sure your final wishes are as clear as possible. Here are some mistakes you might be making right now that could send your family to probate court in the future.
Not Setting Retirement Account to "Pay on Death"
You may not realize that your family might need to head to probate court simply because your retirement account remains in your name. That could cause a dispute among family members about who is entitled to that account. An easy way to avoid probate is to set your retirement accounts to "pay on death." That way, when you die, any money in a retirement account will go to your beneficiaries automatically. This can be a relief to your beneficiaries, as they don't have to do anything or go to court to ensure they receive those funds.
Not Having Joint Ownership Agreements in Place
Do you own a business with someone else? If you do, they might assume that your interests in the business go to them in the event of your death. However, you might have different plans and want your interests in the business to go to your eldest child. This kind of dispute could cause your family to go to probate court. Another problem could occur if you do want your part of the business to go to your business partner, but your family disagrees.
To avoid these problems, it is a good idea to formally arrange joint ownership agreements. That way, after your death, your interests in the business will directly go to the person named in the agreement. You can enter into a joint ownership agreement with your business partner or other beneficiaries that you choose. You should also speak to everyone involved so that there is no confusion about what your wishes are.
Joint ownership agreements can also be a smart choice when you own a piece of property and want to leave to a specific person. If they own it with you through this kind of agreement now, there will be no need to discuss the issue in probate court.
Not Updating All Documents
After you've completed all the necessary planning to put things in place for your family after you pass away, you might think your work is done. However, your family might still be required to go to probate court because you did not keep your documents updated. Births, marriages and other life events happen and you must ensure that your will, living trust and other documents are frequently updated to reflect your wishes at any given time.
Use the advice laid out above to assist you in planning your estate so that your family stays out of probate court after you pass away. To be more confident, seek out an expert in probate law like George M Cappello, Lawyer.