Without a proper estate plan in place, your assets may have to pass through the state-mandated probate process, which doesn’t always yield the exact results you may have wanted for your family. Read on to learn how you can avoid probate and record your exact intentions and decisions.
What Is the Estate Planning Process?
Creating a Will
The most basic and well-known aspect of the estate planning process is the will. A will is a legal document that contains specific instructions about how a person’s estate should be distributed when they die. It also names a person who will be responsible for overseeing and distributing the estate property.
For most people, the first and most important step in the estate planning process is to hire a lawyer to help them write their will. Usually, people may become concerned about drafting a will after they buy their first home or have their first child.
Wills have specific requirements in order to be considered legal. Though there may be some variation, will requirements typically include:
- Must be in writing
- The person forming the will must be legally competent
- Must be signed by the testator (will creator)
- Must be signed by and in the presence of two witnesses (ideally, not beneficiaries)
A qualified lawyer with experience in estate planning matters can assist you with these requirements and can help you formulate the ideal estate plan for your needs. They will take into consideration various factors, such as:
- Your life stage and family members
- Your total financial assets
- Whatever long-term goals you have for you and your family
- The specific estate laws of your state
The Probate Process
If a person dies without a valid will in place, they are said to have died “intestate.” When this happens, their estate will be distributed according to state probate laws. Specifically, the property will be distributed according to “intestate succession” principles.
This means that there will be a specific order in which the surviving relatives can claim property. For instance, the property will first be distributed to the deceased person’s spouse and children, then close relatives, etc.
As mentioned, this may not always yield a distribution of property and assets that the person may have wanted. It is much more ideal to be ready with a will in place in case something happens.