The vast majority of probate cases filed in our court systems every year revolve around the affairs of Americans who are ages 60 and over. In fact, there are over 8 million probate cases filed in our court systems every year – this is a staggering number and continues to rise.
In 1989 AARP (American Association of Retired Persons) decided to do a study on probate and its impact on Seniors. The study found that 90 percent of all probate cases involved someone 60 years of age or older. Consumers spent over $2 billion each year on probate-related expenses. The report noted that as much as 20 percent of small estates are completely consumed by attorney’s fees and executor’s fees during the probate process. The study also discovered that most probates take longer than a year to complete and that having a will seemed to make no difference on the time required. In addition to the expense and delays of probate, one should also consider that probate is a public proceeding and anyone can access the information that goes through the probate court.
Probate serves four primary functions:
- Verifies that your will is valid if you have one;
- Inventories and establishes the value of your assets;
- Gives disgruntled family members a forum to challenge your estate plan;
- Transfers title of your property to your heirs.
Do you really need to go through probate to accomplish these tasks? AARP says no. Instead, it recommends alternatives such as a revocable living trust.
A living trust makes probate unnecessary by changing the way you own your property. You still retain absolute control over all of your assets, just as if you owned them directly, but you do not own property in your own name. Instead, your living trust owns your property and you own your living trust.
In order to get the most out of your living trust it is imperative that your trust be properly funded. The number one reason most trusts fail is due to not funding the trust. To fund the trust, you simply title your assets (property, bank accounts, savings…etc) into the name of your living trust in order for it to work. Your trust should also be reviewed periodically to make sure it is up to date and current with the most recent law changes.
For more information or to create or review a living trust, contact us today at 888.222.1328.