The probate process has long been associated with negative connotations and considered by some to be something that should be avoided at all costs. While some financial planners may recommend that those with larger estates try to keep property out of probate whenever possible, this is not a “one size fits all” solution. In fact, the probate system was established to protect the property of the deceased and his or her heirs, especially if the decedent died without a will. In these situations, probate provides step-by-step process to ensure that the correct beneficiaries inherit a decedent’s property.
After a person’s death, the probate court appoints an executor or personal representative for the estate, who is tasked with settling the estate. The estate settlement process includes making an inventory of assets and their values, paying taxes, debts, and other obligations, and making distributions to the beneficiaries. This process is regulated by state law and the terms of the decedent’s will, if one exists. (It is important to note that this estate settlement process occurs even if the decedent’s assets avoid the probate process.) The length of the estate settlement process varies depending on the complexities involved, but it typically takes one to three years.
Some of the advantages and disadvantages of probate include the following:
- It provides a trustworthy procedure for distributing the property of the decedent if no will exists.
- It validates and enforces the intentions of the decedent if a will does exist.
- It provides a way to protect the decedent’s property from being taken or used by unauthorized individuals.
- It gives the executor access to assets that might have been frozen at death, such as financial accounts.
- It ensures taxes and debts are paid, so there’s a finality to the decedent’s affairs, rather than an uncertain, lingering feeling for the beneficiaries.
- If the decedent was in debt, probate gives a brief window for creditors to file a claim, which can result in the forgiveness of some debts.
- Probate can be advantageous for distributing smaller estates in which estate planning was unaffordable.
- Probate is a matter of public record, which means personal family and financial information may become exposed to the public.
- There may be considerable costs, including court, attorney, and executor fees, all of which get deducted from the value of the estate.
- Probate can be time-consuming, holding up distribution of the assets for months or even years.
- Probate can be complicated and stressful for your executor and your beneficiaries, especially those who are not familiar with the process
When considering the pros and cons of probate it is important to consult an estate planning professional who can help you develop a strategy for your estate plan that is right for you and your family and may even offer alternatives to probate based on your circumstances.
More from Cumberland Trust