New Yorkers who are new to estate planning may not know what happens to a will after a person passes away. Many people assume that assets listed in a will are automatically distributed to the named beneficiaries, but the process can actually take months or even years.
After a person dies, the executor of the will (who is someone appointed by the creator of the will) has to obtain a death certificate and file the will in probate court, which makes the will a matter of public record. “Interested parties” then have an opportunity to challenge the will, and these people include beneficiaries named in the will, family members of the decedent (even if they were not listed in the will), and creditors who were owed money by the decedent.
The probate court process is not free, and fees are typically paid out of the estate of the decedent. Probate is not required for all assets and property. Retirement accounts are one example of an asset that avoids probate, provided the account holder listed a beneficiary over the age of 18. Even if someone lists a retirement account in a will, the beneficiary named on the account itself will prevail over the person named in the will.
Similarly, if property is held as a joint tenancy with right of survivorship, like a marital property home, this asset will belong entirely to the surviving co-owner. Another way to avoid probate is to put assets into a living trust rather than a will. Living trusts give people more flexibility since they can instruct a trustee (similar to an executor) on when and how they want their assets disbursed. Not all assets have to be distributed immediately upon death; they can remain in the trust until a set event occurs. An estate planning attorney can go into further detail about the types of trust funds available.