Probate vs Non-Probate Assets

Do you know the difference between probate and non-probate assets?

It’s wise to understand what types of assets are probate assets and which are not.

Getting clear on this and managing your assets correctly in your estate plan allows you to exercise more control over how your assets are passed to your loved ones.

In general, you want to make sure you have as many assets that are not subject to probate as possible in your estate. This article will clarify the differences between these two different types. Additionally, I’ll offer information about methods to convert those that are subject to probate into those that are not.

Assets Not Subject to Probate…

For simplicity’s sake, those assets not subject to probate typically include life insurance policies, investment accounts and retirement accounts. These are accounts that require you to name a beneficiary. These assets are paid out directly to your named beneficiary when you pass away. In addition, jointly owned assets (such as a joint bank account) are typically not subject to probate either. This is because when one of the owners passes away, their share of ownership is redistributed proportionately among the remaining owners.

Those that Are…

All other assets in your individual name (meaning without a pay-on-death beneficiary or joint owner) are deemed assets subject to probate. As such, they must go through the probate process to legally transfer to the intended beneficiary/heir-at-law. These assets could include real estate such as your personal residence, family property, time share or land. Probate assets would also include personal property like jewelry, cars, boats, or furniture.

Not only do non-probate assets not have to go through probate, but you also get to define and control the timing and way these assets are distributed to your loved ones.

Now, besides knowing the different kinds of assets, knowing that there are methods that convert those subject to probate, is also very helpful. The primary way of doing this is by setting up a Trust and transferring as many assets into the Trust as possible.

Having a good understanding of both types of assets is good as you prepare to meet with an attorney to create your estate plan. This knowledge can also be helpful in updating an existing estate plan. If you would like our help creating your estate plan or updating an existing one, give my office a call at (470) 235-7868.

Looking to find an experienced estate lawyer in the Georgia area who is skilled in asset protection and estate plan preparation? Shannon Pawley is an attorney in Georgia with expertise in estate planning and asset protection. Shannon can provide assistance with creating an estate plan to include making a will and how to establish a trust properly. If you have questions about asset protection or questions about making an estate plan, reach out to Shannon and she will be glad to help answer all the estate planning questions you might have!