Estate Planning is an umbrella term that simply means one is planning how they want their assets to pass down after they die.
Estate Planning can take three forms: 1) Probate Estate; 2) Trust Estate; or 3) Payable on Death/Beneficiary Forms. Some people fall into one of the categories. Some people fall into all three.
A Probate Estate takes place when a person owns an asset solely in their name without any beneficiary designation attached. When this happens, the estate will be ushed through the probate court of the county in which they reside or where they own real estate. If they have engaged in planning, they have written a Last Will and Testament which will tell the court what beneficiaries should receive the funds after final expenses are paid.
A Trust Estate is one in which an individual has written and signed a trust document and then titled their assets in the name of the trust. The trust document gives direction how the funds are to be spent during the individual’s lifetime and who is to receive the monies after death. Any assets placed in the trust will not need to be administered through the probate court.
Payable on Death/Beneficiary Forms
Payable on Death/Beneficiary Forms are documents that specify where a specific, individual asset is to be distributed upon the owner’s death. Examples include a beneficiary designation on a life insurance policy or IRA, a Transfer on Death account, or a house held in joint tenancy with rights of survivorship. This type of asset does not go through probate court and is the easiest type of estate to administer. However, it is not always the best planning option, particularly when there are multiple beneficiaries with generational heirs, because the forms often do not allow you to go to the level of detail that a Will or Trust does.
Estate Planning is an important process that everyone should go through to ensure that their assets are distributed according to their wishes. Probate, trusts, and payable on death beneficiary forms are all options that can be used in estate planning.
Our experienced team can help you determine the best option for your situation and create a comprehensive plan that meets your needs. Contact us today to get started on your estate planning.
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Whether you're planning for your parents, your spouse, or even yourself, The Law Practice of Dennison Keller, LLC will meet you at the crossroads of legal and care advocacy to show you one clear path out of the maze and get you on the road toward your own peace of mind.