We know that estate planning can be confusing, and many Floridians assume that drafting a last will and testament or taking some basic steps can automatically help their loved ones avoid probate. Unfortunately, this assumption is often wrong, and without proper planning, even well-meaning efforts can lead to an extended probate process.
It is important for you to know probate in Florida can be time-consuming, expensive, and emotionally draining for those left behind. While probate is not always avoidable, there are specific strategies you can use to reduce the likelihood of your estate being tied up in court after your death. Are you, however, unknowingly setting yourself up for probate? Let’s explore some key estate planning missteps that could land your loved ones in probate court, and provide solutions you might not have thought of.
1. Assuming a last will and testament is enough. One of the most common misconceptions is that having a will means probate can be avoided. In reality, a will is typically the first step into probate in Florida. The purpose of a will is to direct how your assets will be distributed, but it doesn’t shield those assets from going through the court-supervised probate process.
What could be the solution? Your estate planning attorney may encourage you to consider a revocable trust agreement. This is a valuable tool that many people overlook. By placing your assets into a trust, you can keep them out of probate while maintaining control over them during your lifetime. Upon your passing, the assets transfer to your designated beneficiaries without court intervention. This method saves your heirs time, legal fees, and ensures privacy since trust documents do not become part of the public record.
2. Not coordinating your beneficiary designations. Even if you have a comprehensive estate plan, overlooking how assets like life insurance policies, retirement accounts, or payable-on-death (POD) accounts can be structured to inadvertently lead to probate. When beneficiary designations aren’t aligned with your estate plan, or if a beneficiary predeceases you and there is no backup named, those assets might end up in probate.
What could be the solution? Make sure you regularly review and update beneficiary designations. One approach many overlook is naming a trust as the beneficiary instead of an individual. By doing so, you ensure that the assets follow the terms of your trust, avoiding potential probate and keeping them within the control of your broader estate plan.
3. Failing to properly title joint accounts. A common estate planning method is to place assets in joint accounts with a spouse or adult child. Many assume that this is enough to bypass probate, as the surviving joint owner will automatically take over. This can lead to unexpected probate issues, however, especially if the surviving owner is unable to manage the assets or passes away soon after you.
What could be the solution? Your Florida estate planning attorney might recommend adding a survivorship clause or establishing joint tenancy with rights of survivorship (JTWROS) on key accounts. Additionally, using a revocable trust agreement can be a more robust and comprehensive way to ensure these assets are properly managed and distributed without relying on joint accounts alone.
4. Forgetting to transfer real estate into your trust agreement. One major estate planning mistake is assuming that a last will and testament alone may govern how your real estate is handled. In Florida, real estate can be a significant trigger for probate, especially if it’s titled solely in your name at the time of your death. A will directs who receives your home or property, but it doesn’t prevent that property from going through probate.
What could be the solution? You may want to discuss with your attorney if you should consider transferring your real estate into a revocable living trust. By doing so, you ensure that the property avoids probate and passes directly to your beneficiaries according to your trust instructions.
5. Ignoring the importance of digital assets. In today’s digital age, many people forget that their digital assets, such as online accounts, social media profiles, cryptocurrency, and even cloud storage, need to be addressed in their Florida estate plan. Without a clear plan, accessing these assets can become a probate issue, as Florida’s current laws don’t make it easy for loved ones to access digital property after someone passes away.
What could be the solution? Work with your attorney to include instructions in your estate plan regarding digital assets. Designate a trusted individual to manage or close your online accounts, and make sure they have access to passwords and security information. You can also use a digital asset trust to ensure that certain assets, such as cryptocurrency, are protected and transferred according to your wishes.
6. Failing to update your Florida estate plan after major life changes. Life events such as marriage, divorce, the birth of a child, or moving to another state can have a major impact on your estate plan. Unfortunately, failing to update your estate documents after these events can leave you vulnerable to probate. For example, a last will and testament or trust agreement created before a divorce may still list your ex-spouse as a beneficiary, leading to a probate battle.
What could be the solution? Regularly review and update your estate plan to reflect major life changes with your Florida estate planning attorney. This includes updating wills, trusts, and beneficiary designations. In Florida, be mindful of state-specific laws that might affect how assets are treated during probate, and ensure your plan reflects your current wishes.
Remember, you are not alone in this journey. Unknowingly setting yourself up for probate is more common than you might think. Even with good intentions, missteps in estate planning can leave your family navigating a lengthy and costly probate process. We do telephone, computer, and face-to-face appointments. Our face-to-face appointments are held outside in the open air (frequently selected by clients for document signing) and inside our office conference room. We encourage you to contact us to schedule a meeting.