Business Succession, Estate Planning, Life Insurance, Probate, Real Estate, Trusts, Wealth, Wills

How to Avoid Probate Without a Trust

I say it all the time, and I’ll say it again: probate sucks.

Why? Because it costs a lot of money, and it usually takes a long time to accomplish.

So how do you avoid it?

Well, there are many ways, but the most common way that most people think of is by having a revocable living trust.

But what if I told you there are other ways?

That’s right.

In fact, if you don’t own real estate, you could potentially avoid probate entirely without a trust whatsoever.

The magic is found in beneficiary designations.

As a reminder, beneficiary designations rule over everything else.

That means even if there is a will or a trust stating to the contrary, beneficiary designations are going to determine to whom the asset goes rather than the will or trust.

It also means that the beneficiary designations are going to happen even if there is no probate.

The only down side is that you have to keep up on your beneficiary designations. If one of your beneficiaries dies, if you disinherit someone, or you change your mind, you’re going to have to do some paperwork each time.

And that can be a pain.

So, yes a trust is a way to avoid probate, but beneficiary designations (structured correctly) can help you avoid probate as well. Even without a trust.