Probate is the court-supervised public proceeding used to change title to assets from the name of an individual who has passed away into the name of the living beneficiaries. It is also the process by which creditors of a decedent file claims to collect their debts and where interested parties who have a complaint regarding the deceased can file a complaint (a will contest).
Even without a contest, probate can be costly and time consuming. A Will provides written instructions to the court as to how you want the probate estate to be distributed (your beneficiaries), who you want to handle the probate process (your Executor) and, if you have minor children, who you want to raise those children (your Guardians) and who you want to be in control of the money for those children (your Trustee).
Why Most People Want to Avoid Probate
First, it requires frustrating intrusion by the court, lawyers, and the public into a very emotional, private, family time. A judge may have to determine who is a legitimate creditor, and may have to rule on distributions to children and other beneficiaries. Your estate may have to hire a lawyer to shepherd the executor through the legal maze.
Second, all of your affairs will become public knowledge. The contents of your will would be on file in the courthouse, for all to read and wills are read. They are read by salesmen, by newspaper reporters, and by the morbidly curious, all seeking in one way or another to take advantage of the publicity required by the probate process.
Third, probate takes time. Unless your executor is absolutely certain that there are no debts owed by the estate (a rare occurrence, since almost everyone leaves some small debts behind) and is to accept personal responsibility for your debts, the Virginia probate law mandates that your assets not be distributed for one year after you die, to allow creditors time to petition the court for full payment.
Any assets distributed before that time come with a heavy cost for your executor he or she is personally liable for the repayment of all of this amount, even if the beneficiaries to whom distribution is made have already spent the amount distributed. Thus, your executor will likely be very hesitant to distribute before all debts and taxes are paid.
The court, not your family, will supervise and authorize the settling of all debts and the payment of inheritances, in its time and with its delays. Fourth, on a national average the probate process takes from five to eight percent of your family estate out of the hands of your beneficiaries and gives it to the courts and other outside individuals.
In Virginia, this is usually lower, but can also be higher in the event of unusual circumstances, such as a will contest. Planning with a trust can save the average American family about $30,000 in probate fees, attorney fees, and court costs alone, according to a national study by the AARP. The upfront cost of a trust is only slightly higher than just a will, but the savings in the end can make the initial expense more than worthwhile.
Fifth, if you are not competent at any time before your death, the trustee of your living trust can serve as the caretaker of your property. This can avoid the expensive and embarrassing public guardianship/conservatorship proceeding, where your children have to prove that you are not able to manage your own affairs. A living trust combined with a power of attorney can provide the most complete protection available.