At some point, we all have to face the realities of passing our estate over to our children and other family members. Although it might not be the most uplifting of things to organize, it is a great way to start thinking about the legacy that you wish to leave for your loved ones and the positive things that you see in their futures.
You also have to recognize the threat of the alternative, which is avoiding the creation of a trust or other financial tool until it's too late, meaning that your affairs need to go through probate.
What is probate?
Probate is the standard financial procedure that occurs after a person's death. The court basically distributes the estate based on standard legal and financial guidelines. Of course, this is not ideal for anyone, since people will have their own personal preferences on how their finances should be handled. This will mean that a certain amount from your estate will be taken to cover the probate costs. It also means that your finances will take a long time to finally reach your loved ones, and that your financial matters will become public record.
How to avoid probate
Taking steps in your lifetime to avoid the disadvantages of probate is an advisable plan. This can be done by setting up a living trust and/or other financial instrument so that your wishes are expressed in legal terms.
Writing a will means that you have full control over your estate and can set out the exact details of how you want your assets to be distributed.
Source: Money Crashers, "What Is Probate – Definition, Process & How to Avoid It," accessed Nov. 22, 2017