In the 7th of our Coronavirus Preparedeness series, Wes Coulson discusses what you need to avoid probate.
This is one that I think has much broader application. It’s in the series because it’s on people’s mind right now. You know I’ve talked a lot about the importance of avoiding probate, so important question there, “How do you get it done?” Is a will going to do it? Do you need a living trust? Let me speak to that in a few ways.
First, as a general proposition, having a will does not avoid probate. Wills are actually intended to go through the probate process. Now, I’m going to tell you that having one if you have to go through probate is much better than not having one at all, because if you don’t have one, whoever is in charge of things is going to have to post a bond and usually pay a bond premium. Most things will have to be done through the supervision of the court, so it is a much more expensive and time consuming process.
But, sometimes wills work and they don’t have to be probated – It depends on state law. In Illinois, if the value of your estate that passes under your will is less than $100,000 and doesn’t include real estate, you can avoid probate. So some people, if things are set up and their assets are limited, a will works just fine. It’ll let everyone know who gets what, who’s in charge, without going through probate. If you have more assets, if you have any kind of special circumstances, and just in general because there’s a lot more things we can accomplish with it, a living trust that has been properly funding (that means assets are in it – think of it like a safe, it does a great job of protecting things from the bad guys, but only if you have in the safe what you want to protect,) that’s the best, that’s the surefire way of staying out of probate.
What we do, we look at everybody’s situation individually and figure out what’s going to work best for you, and be the most cost-effective, not only now but also at the point when you die and somebody is going to be in charge of settling your affairs.
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