Get The Facts About Probate

For many of us, probate calls to mind stories of heated court battles that bankrupt the very assets families are fighting over. In reality, probate doesn't have to be an unpleasant, lengthy or costly experience. "There are a lot of myths about probate," says Dalia Stokes, a board-certified estate planning and probate attorney in Houston, Texas. What follows is a look at some of the misconceptions about probate and the steps you can take to ensure the quick and efficient distribution of your own estate.

Myth: Having a will means you avoid probate.

Fact: Probate is simply the legal process for passing property on to heirs. Wills must be probated, but having a will can help the process go smoothly since it determines who gets what and who is in charge of the estate.

Myth: Probate is a lengthy ordeal that is best avoided.

Fact: Most probate administrations are six to nine months of paperwork, not extended court battles.* "The only basis for saying that probate should be avoided is if you anticipate that someone may challenge your estate plan," Stokes says. "An estate plan that passes through probate gives the challenger a better opportunity to contest, in which case the probate process can become costly and lengthy." Fortunately, the majority of estate plans aren't contested. "In most cases, probate is an inexpensive and efficient procedure for the orderly transfer of assets," Stokes says.

Myth: You won't pay taxes if you avoid probate.

Fact: "It's true that the tools that help you avoid probate, such as living trusts with tax-saving components, can save you money on taxes," Stokes agrees. "But you can use the exact same tax-saving strategies in a will which does have to pass through probate."

Myth: Probate is expensive.

Fact: The cost of probate varies depending on where you live. In most states, attorneys charge an hourly rate. "Other states require that an attorney get a percentage of the estate, usually around 3%," Stokes explains. More often, the complexity or size of the estate will dictate the cost of probate, but in most cases the expense is reasonable.*

Making Efficient Probate A Reality
There are several steps you can take to help probate of your own estate go smoothly.

• Organize your records.
  
  
• Take care in selecting witnesses for your will, especially if a contest is anticipated. "Many people will ask their minister or a well-respected neighbor to witness their wills," Stokes says.
  
  
• Discuss your estate plan with your family.
  
  
• Consult a professional to prepare an estate plan that is right for your situation.

When Avoiding Probate Is Best
There are situations in which to avoid probate -- such as when it will save significant time or money or when keeping an estate plan private is a priority. To find out what estate planning tools and techniques are best for your situation, consult an estate-planning professional. Our estate planning specialists will be happy to help you create the optimal estate plan for your situation. Call or stop in today to make an appointment.

*Source: Kiplinger's Personal Finance Magazine

*Investment services offered through Union Bank & Trust Company’s Trust Division.
Investment products: Not FDIC Insured - No Bank Guarantee - May Lose Value.