How can you avoid unnecessary probate costs in Michigan?
It’s not just the size of an estate that causes probate to cost more. Family conflict, assets that aren’t in Michigan and unusual assets like collectibles also drive up the cost of probate.
Be consistent
Conflicting information in your estate plan causes conflict between your family. You may want to double-check after finishing your estate plan that nothing contradicts itself. If you named person A as the beneficiary of your retirement account but stated in your will that person B will receive your retirement assets, then there might be an argument over what you wanted.
Inconsistent stipulations in your will slow down the probate process. The court would have to decide what to do with that particular asset.
Own property jointly
Joint ownership allows you to pass on property to the other owner after your death. Some people like this option for their spouse and/or child. The downside of joint ownership is you can’t make changes without the other owner’s permission. Another drawback is if they lose a court case or have debt, then the judicial system could seize the property to pay what they owe.
Set up trusts
Revocable trusts are a way to avoid probate while maintaining control over the asset. You can modify or revoke them. Irrevocable trusts, on the other hand, are usually set in stone once you establish them and deposit an asset. Trusts also typically protect assets from creditors. If you intentionally avoided paying off debts and hid the money in a trust, however, law enforcement could take assets from the trust to pay back creditors.
Set up transfer-on-death accounts
Some financial accounts allow you to name a beneficiary. The account would transfer automatically to the beneficiary without needing to go through probate.
There are plenty of estate planning strategies that you could use to reduce the time cost of probate. The longer that probate takes, the more it costs. You may want to avoid putting anything in your will that doesn’t need to be there.