If you are like most people, you want to make life easy for your loved ones. One way you do that is through the inheritance you leave them when you leave this earth.
Unfortunately, if you have not set up your estate plan properly, much of it may end up in government hands. Therefore, these are a few things you can do to avoid or minimize probate and estate taxes.
Every bank and retirement account as well as your insurance policies and investment accounts, including stocks and bonds or brokerage accounts, allow you to name beneficiaries. Therefore, contact all these account holders and make sure you clarify who they go to upon your death.
Add names to your property deeds
Any real estate that has more than one owner listed on the deed automatically passes to the co-owners when one owner dies. Therefore, if you plan to give property to your children or spouse, add their names to the deeds. The probate process will not include any jointly owned property. However, if you marry any property typically goes directly to your spouse.
Create a living trust
A living trust places all your assets into an account. It is as if you sold them but still retain usage rights until you die. When you set up the trust, you name your beneficiaries. You can change and update your trust at any time, but it is especially beneficial to do so when you experience major life changes, such as marriage. Trusts are not subject to probate because the asset distribution has already occurred.
Writing a will is a great start to planning your estate, but simple things, such as setting up transfer-on-death securities, vehicles or financial accounts, can significantly save time and money.