Probate proceedings can be time-consuming and costly. They may, too, create stress during an already challenging time for families dealing with the loss of a loved one.
However, individuals in New York can use strategic measures to sidestep the probate process. In doing so, they can help ensure a smoother transition of assets to beneficiaries.
Establish a living trust
Creating a living trust is a proactive step to avoid probate in New York. By transferring assets into a trust, an individual can designate a successor trustee to manage and distribute those assets. This legal arrangement allows for the seamless transfer of property without the need for probate court intervention.
Joint ownership with right of survivorship
Property co-ownership, specifically with the right of survivorship, is another effective strategy. This arrangement ensures that when one owner passes away, the surviving owner assumes full ownership of the property without the involvement of probate. Common assets held in joint ownership include real estate, bank accounts and investments.
Designate beneficiaries for accounts and policies
Assigning beneficiaries to retirement accounts and life insurance policies helps bypass probate for these assets. By naming specific individuals as beneficiaries, the funds go directly to them upon the account holder’s demise, avoiding the need for court involvement.
Gift assets during life
Another strategic way to reduce probate involvement is by gifting assets during one’s lifetime. By gradually transferring property to intended beneficiaries, individuals can reduce the value of their estate subject to probate.
According to AOL, the probate process is a costly one, costing between about 3% and 5% of an estate’s total value. By incorporating these tactics, individuals in New York can minimize the impact of probate on their assets. They can also help ensure a more efficient and cost-effective transfer of wealth to beneficiaries.