When you leave a will behind, the process your estate goes through before the beneficiaries take control of their share of assets is known as probate. It is a court-controlled process that consists of establishing the legality of the will, consolidating assets and settling pending debts before final distribution to the beneficiaries.
Probate comes with its fair share of costs, from probate fees to the legal expenses involved, and the whole process can take a long time to conclude. On top of that, probate proceedings may be accessible to the public.
To save your beneficiaries the trouble, you can utilize trusts to transfer property more quickly and efficiently without having to go through probate.
Making use of trusts
Once you set up a trust and transfer assets into it, they are no longer legally considered part of your estate. As a result, these assets held in the trust will not have to go through probate or involve the court. It can be beneficial in several ways.
Remember, probate fees are relative to the size of your estate. It means that you will have to part with a considerable amount of fees if your estate is sizable. If you transfer legal ownership of assets in your estate to an irrevocable trust, it will reduce the size of the taxable estate, which could save you a lot in taxes.
You will also be assured of your privacy with a trust since only the concerned parties will be privy to its terms.
Choosing the right trust
Trusts can be extremely useful when making your estate plans but only when done right. Given that there are several kinds of trusts to choose from, it is advisable to seek guidance on how to go about making the right choice to reap the benefits.