Estate Planning And Pay On Death Accounts
Probate avoidance is an important part of estate planning, and the term is foreign to a lot of people who are first exposed to it. You have to understand that your Will is not something that is just passed around between family members around the kitchen table.
There could be outstanding debts that must be addressed, and creditors have the right to have them satisfied. It is also possible that someone could feel as though the Will is not truly valid or reflective of the wishes of the deceased. For these reasons and others a Will must be probated by the probate or surrogate court before the heirs to the estate receive their inheritances in accordance with the stated wishes of the deceased.
As you might imagine, this process can take a good bit of time and as stated those who are in line for bequests will not receive them until probate has run its course. Most individuals would like to see their loved ones receive their inheritances in a timely and hassle-free manner, and this is one of the reasons why probate avoidance strategies are so frequently utilized in the field of estate planning.
Some of the strategies that are implemented are complex financial instruments that provide tax efficiency. But there are some simple ways to get assets into the hands of your loved ones after your death outside of probate. One of these is the creation of pay on death or transfer on death accounts.
You simply open one of these accounts at a bank or some other type of financial institution and after funding it you name a beneficiary who will assume ownership of the assets in the account after your death. This individual can’t access the funds while you’re still alive, and you may change the beneficiary or even close the account if you want to so you retain total control. When you do pass away, your beneficiary assumes ownership of the assets more or less immediately outside of the process of probate.
Though pay on death accounts hold a certain appeal, they are just one tool in your estate planning toolkit. To create a comprehensive plan for aging, sit down and discuss the matter in detail with an experienced and savvy estate planning attorney. The Zimmer Law Firm can help. Call 513.721.1513 for your consultation.