According to a new study, only 65 percent of Americans understand the definition of "probate," and 35 percent say they do not understand the process at all.
Probate is a court process in which your estate is assessed, taxes are levied, debts settled, and assets distributed.
Millions of Americans do not realize the financial and emotional cost of probate
Under normal circumstances, this would be a problem, but upcoming circumstances portend that this lapse in estate planning knowledge may be financially catastrophic for many Americans. The impetus for the survey is the "Great Wealth Transfer"—an anticipated transfer of $72.6 trillion in assets from the Baby Boomer generation to their kin. Experts have said that a lack of estate planning may hamper this transfer. The survey certainly underscored this concern.
Court proceedings can be a long, confusing, and expensive process that can siphon assets from an estate until there are none left for loved ones and beneficiaries. The best way to avoid probate is proactive estate planning.
More than 60 percent of Millenials do not have estate plans
The survey indicates that many Americans have not prepared their estate legacies. Dying without an estate plan - or, more specifically, a will - is known in legal terms as "dying intestate." This event triggers a specific probate court process in Florida that determines how your estate will be assessed and distributed.
Are you prepared or still waiting to start the process, as most people surveyed indicated? Here are some key takeaways from the magazine's report, "The State of Probate in America":
- Most Americans underestimate both the financial cost and the duration of the probate process. The average probate timeline is 20 months, and potential costs range between 3 percent and 7 percent of the estate's total value. However, when a solid estate plan is established, settling an estate typically takes 5-6 months. Complications like a non-responsive executor, contested will, absence of a will, or non-compliant documents can extend the process to a year or more.
- More than 60 percent of Millennials do not have a will or trust, and 34 percent are unaware of their parents' estate plans. When an individual dies without a will, Florida relies on intestacy law and probate court to dictate the distribution of assets based on familial relationships. The outcome may not align with the decedent's preferences.
- Half of Americans don't know whether they live in a state that requires probate to settle an estate. In Florida, when an estate lacks a will or there are disputes, probate is necessary. The state's probate court resolves estate disputes and manages asset distribution and creditor claims.
While the lack of planning is worrisome, the study provided some hope for the future, too. The majority of Americans - 65 percent - say they recognize the probate process's complexities and would seek help from a probate attorney to draft legally sound wills and trusts that ensure their loved ones are cared for and informed. By working with an experienced South Florida estate planning attorney, individuals help ensure a smooth and efficient asset transfer, potentially saving heirs time, money, and emotional distress.
Protect the people who matter most
For all but the smallest estates in Florida, completely avoiding the state's probate process is not possible. However, there is a lot you can do to make the process smooth and painless for loved ones. Creating a solid estate plan reduces the potential for disputes that could wind up in probate court. Not just any estate plan will do, however. DIY wills often fall short of legal standards and undergo challenges that drag estates through probate.
Consulting with an estate planning attorney ensures legal documents are properly executed and tailored to individual needs and goals. At The Levy Firm PLLC in Fort Lauderdale, we are committed to helping you distribute your assets according to your wishes. Contact us for a private, no-cost consultation to get your questions answered, understand the process, and learn more about how Geoff can help you secure your legacy today.
“Mr. Levy gave my family and I something of utmost importance and significance - HOPE. He listened intently, citing the law where it could be applicable in my situation. I urge you to give Mr. Levy an opportunity to assist you as well. You will not be disappointed. It was refreshing to see someone still interested in not only the law, but people, too.” - Q.B.