You’ve spent years building your nest egg, paying off your home, and squirreling away for the future, but then—poof!—you’re gone. Your grieving relatives are not just dealing with your loss; they’re stuck navigating the tangled web of probate court. Instead of grieving with dignity, they’re left dealing with paperwork, legal fees, and delays. The situation can be a nightmare.
Fortunately, with some smart planning, you can save your loved ones the headache of probate. At Goff Legal, PC, we help clients in Roseville and Rocklin secure their assets and ensure smooth transitions for their heirs. Let’s break down some strategies you can use to keep your estate out of probate and save your family from needless bureaucratic nightmares.
Hold title as joint tenants or community property with right of survivorship
One of the simplest ways to keep property out of probate is to ensure it’s titled correctly. If you own property with your spouse or someone else, you can hold the title as “joint tenants,” or if you are married, you have the choice to take title as “community property with right of survivorship.” Upon your death, the surviving co-owner automatically inherits the property without needing to go through probate.
If you haven’t already set up your property this way, check your deed and consider making changes. Remember that this strategy works best for assets like homes, but it won’t help with everything else you own. For more complex estates, additional tools may be needed.
Set up a living trust
A living trust is one of the most effective ways to avoid probate in California. By creating a revocable living trust, you transfer ownership of your assets—like your home, bank accounts, and investments—into the trust during your lifetime. The beauty of a trust is that it allows you to maintain control over your assets while you’re alive, and it smoothly passes them on to your beneficiaries after your death without court involvement.
When you create a trust, you appoint a trustee (which could be yourself while you’re alive and a successor trustee after you pass away). The trustee manages the assets according to your wishes. Unlike a will, a trust doesn’t need to be validated by a court, meaning your assets can be distributed more quickly and privately. At Goff Legal, PC, we help clients set up customized trusts to fit their needs, ensuring a seamless transfer of their estate.
Use a transfer on death (TOD) deed for real estate
California offers a simple way to transfer real estate through a Transfer on Death (TOD) deed. This allows you to name a beneficiary who will automatically inherit your home when you pass away. Unlike adding someone to your deed as a co-owner, the beneficiary has no ownership rights during your lifetime, which means you maintain full control of the property until death.
However, there are issues with this process, and it often involves court intervention after death, so we recommend you proceed with caution before considering using this document to transfer your real estate to avoid probate.
Designate beneficiaries on financial accounts
Many financial institutions allow you to designate beneficiaries on accounts like savings, checking, and retirement accounts. This simple step can help avoid probate by ensuring that these assets pass directly to your beneficiaries when you die.
Accounts such as IRAs, 401(k)s, and life insurance policies typically let you add “payable on death” (POD) or “transfer on death” (TOD) designations. This means the named beneficiaries will receive the funds without any court intervention. Be sure to regularly review and update these designations, especially after life events like a divorce, marriage, or the birth of a child.
Use joint ownership for other assets
For certain assets like vehicles or smaller property, holding them jointly with another person can keep them out of probate. Similar to real estate held as joint tenants, jointly-owned property automatically transfers to the surviving co-owner when one owner dies.
While joint ownership can be a useful strategy, it’s not without risks. Once you add someone’s name to your asset, they have equal ownership. This means their creditors could potentially come after the asset, or they could sell their share without your permission. Always weigh the risks and consult an attorney before pursuing this option.
Gift assets during your lifetime
One of the most direct ways to avoid probate is to simply give your assets away while you’re still alive. By gifting property, money, or other assets to your loved ones now, you can reduce the size of your estate, ensuring that less goes through probate after your death.
However, there are limits to how much you can give without triggering gift taxes. In 2024, the annual gift tax exclusion is $18,000 per recipient. Anything above this amount may require you to file a gift tax return. Goff Legal, PC can help you structure gifts in a way that minimizes tax liability while maximizing the benefits to your heirs.
Create a comprehensive estate plan
The best way to protect your assets from probate is to have a well-thought-out estate plan. This doesn’t just mean writing a will, which on its own won’t keep your estate out of probate. An estate plan includes a combination of strategies—like trusts, trust funding, and beneficiary designations—to ensure your assets are protected and your loved ones are spared probate.
At Goff Legal, PC, we specialize in creating customized estate plans that reflect your unique situation. Whether you have a simple estate or more complex assets and family dynamics, we’ll work with you to ensure your wishes are carried out smoothly and efficiently.
Probate can be a long, expensive, and frustrating process for your loved ones to deal with after you pass away. Thankfully, with proper planning, you can spare them the ordeal. From joint ownership to living trusts, there are several tools at your disposal to keep your assets out of probate. At Goff Legal, PC, we help you navigate these options and create an estate plan that works for you—contact us today to learn more.
