May the Fourth be with you! May 4th has quickly become a tradition for die-hard Star Wars fans across the globe, who come together to celebrate what they love most about the popular movies. However, Star Wars’ themes aren’t just relative to space alone. When it comes to your family, you’re going to want to prevent some battles of your own—albeit not the intergalactic kind.
Estate planning ensures that your assets and debts are assigned in a way that is best for your family. This will keep family harmony, and no one will have to go through probate court. Through estate planning, you will keep the peace in your family by avoiding probate court (which, for symbolic purposes, you can think of as the Death Star of the legal world). Probate court leads to nothing but trouble, and to avoid estate wars within your family, there are some things you must do.
Why is Probate Court So Bad?
Okay, so probate court might not be totally as serious as a planet-destroying star, but it definitely is not where you want your family to be. People who die intestate (meaning they die without a will) or people who die with a last will and testament have to go through probate court. During probate, your estate—assets and debts—are divvied out by a judge.
A family member is appointed to be the executor of your estate. Debts are paid off first; that is goal number one of probate court. Then, whatever’s left is divided among the eligible recipients. The process is long and drawn out, and there is not a great likelihood that you will see your assets go where you want them to. The debts also may be assigned in ways that greatly disadvantage those selected to pay them off. All in all, probate court is not the answer for your family.
How to Avoid It
A common misconception is that having a last will and testament will automatically get you out of probate court and tie up your affairs nicely. That’s not true, however. A last will still has to go through probate court, and it will still take a long time.
The alternative to that is a living trust. With a living trust, there are three parties: you, the trustee, and the beneficiary. You, as the donor, confer nominal ownership of assets to the trustee, who, at a date you give them, hands over your assets to your chosen beneficiary. This gets you out of probate court and puts your estate immediately into the hands of the people you want to get it. There is no middleman, and your beneficiary will be grateful to you for that.
Probate court serves its purpose, but it is not a place that families want to go. Between the time consuming court trips, the costs, and the overall drudgery of this legal process, planning your estate in order to avoid these problems is a far better alternative than risking “estate wars.”