If you are just beginning to consider what estate planning means to you, you’ll be confronted with a number of terms that may be somewhat unfamiliar to you as you begin your research. One of these is going to be “probate avoidance,” and before you can understand why you may want to avoid it you need to know exactly what probate is.
By definition probate is the legal process of estate administration that takes place under the supervision of the probate or surrogate court. During this interim the court will examine the will to determine its validity, and the executor will subsequently inventory assets, pay off any outstanding debt and ultimately distribute inheritances to the heirs in accordance with the final wishes of the deceased as elucidated in the will.
Why would anybody want to avoid this legal process? Will take a look at three primary motivations here.
Probate Can Be Costly
The process of probate does not come without a price. There are court costs, the executor’s remuneration, probate attorney fees, possible accountant fees, appraiser fees, and estate liquidation expenses. All of these bills could add up to as much as 5% of the overall value of the estate and sometimes even more in complicated cases.
Probate is Time Consuming
Depending on the court caseload at any given time and the complexity of your estate, it can take anywhere from several months to a number of years for probate to run its course. And the fact is that your heirs will not receive their inheritances until the estate has been closed by the probate court.
Probate Is Public
Probate is a public proceeding so the disposition of the estate becomes a matter of public record. In addition, probate opens the door for those who might be interested in contesting your will, and this is a possibility that many people will take proactive steps to avoid.