Avoid probate to maximize privacy and keep your estate plan confidential

A last will and testament does not avoid probate. In fact, the opposite is typically true. A will is a legal document that expresses a person’s wishes for how their property should be distributed after their death and might name a guardian for their minor children. However, for the wishes outlined in a will to be legally executed, the will usually must go through the probate process, which is a matter of public record.

Probate is a legal process where a court oversees the administration of a deceased person's estate. The process involves proving in court that a deceased person's will is valid, identifying and inventorying the deceased person's property, appraising the property, paying debts and taxes, and finally distributing the remaining property as the will (or state law, if there's no will) directs.

For those seeking to avoid probate, there are several other estate planning tools and methods, such as revocable living trusts, joint ownerships with the right of survivorship and specific beneficiary designations (like in retirement accounts, bank accounts and life insurance policies), which can allow for the transfer of assets without going through probate. Each of these methods has its own legal implications and requirements, and consulting with an estate planning attorney is typically recommended to determine the best approach based on individual circumstances.

One of the primary advantages of a trust, particularly a revocable living trust, is its ability to avoid probate, unlike a will. When you set up a trust, you transfer the ownership of your assets from your personal estate into the trust. This reassignment of ownership means that upon your death, the assets within the trust are not considered part of your personal estate that would normally go through probate. Instead, they are controlled by the trust.

Here’s how a trust helps in avoiding probate:

• Control of assets by the trust. When assets are placed in a trust, they are legally owned by the trust, not by you as an individual. Therefore, upon your death, these assets are not part of your probate estate.


• Immediate transfer to beneficiaries. Since the assets in a trust are not part of the probate estate, they can be transferred immediately to beneficiaries as per the terms of the trust, without waiting for the probate process.


• Privacy preservation. Unlike probate, which is a public process, a trust operates privately. The distribution of assets through a trust is not recorded in public probate court records, maintaining confidentiality in estate affairs.


• Reduction of legal costs and delays. Probate can be a lengthy and costly process, involving court fees, legal expenses and other costs. A trust typically allows for the distribution of assets to occur more quickly and with fewer expenses.


• Flexibility and control. Trusts offer more flexibility and control over how and when your assets are distributed to your beneficiaries, which is a level of detail not typically afforded in a will.

It is important to note that for a trust to effectively avoid probate, the assets must be properly retitled, or funded, in the name of the trust. Assets not titled in the trust (and not otherwise designated to avoid probate) would still be subject to the probate process. Therefore, ensuring that your trust is properly funded and maintained is crucial to fully realize its benefits, including avoiding probate. Consulting with an estate planning attorney is advisable to ensure that a trust is appropriately set up and managed in accordance with your estate planning goals.

While a revocable trust offers many benefits, such as avoiding probate for the assets it holds, it may not address every aspect of your estate. Therefore, it's often prudent to have both a trust and a will as part of a comprehensive estate plan. Here's why it’s often recommended to have both a will and a trust.

• A will can address remaining assets. A common practice is to have a "pour-over" will alongside a revocable trust. The pour-over will serves as a safety net for any assets that were not transferred into the trust during your lifetime. Upon your death, the pour-over will directs, in general terms, that any remaining assets be placed into the trust, ensuring they are distributed according to the trust’s terms – which remain confidential and avoid the publicity of probate. Also, having both a trust and a will can simplify the estate settlement process. The trust can manage most of your assets, but the will can cover any miscellaneous items or last-minute assets, ensuring that nothing is overlooked.


• You can nominate guardians for minor children. If you have minor children, a will is the legal document where you can designate guardians for them in the event of your death. A trust typically does not include provisions for guardianship.


• Some assets may not be suitable for a trust. There might be certain types of assets or personal items that for various reasons aren’t placed into a trust. A will can ensure these items are addressed and distributed according to your wishes.

Confidentiality in estate planning is not merely a preference but a strategic approach with multiple benefits. There are many reasons why privacy is so crucial, and for many people, reducing the risk of family disputes is at the top of the list. That’s because when details of an estate plan become public, it can sometimes lead to disputes among family members. Privacy helps minimize the likelihood of disagreements over asset distribution. It prevents misunderstandings and potential conflicts by limiting the exposure of your estate plan's specifics to only those directly involved.

Privacy in estate planning can contribute to family harmony as well. By managing expectations and limiting the information available to the public, you can prevent any sense of entitlement or jealousy that might arise among family members or close associates upon learning the details of your estate.

Another benefit is that a private estate plan is less susceptible to challenges from outside parties. Public knowledge of your estate details can invite claims from distant relatives, creditors or even opportunistic litigants. Keeping your estate plan confidential helps shield it from such unwarranted external claims.

Privacy can protect beneficiaries from scams and unwanted solicitations. Beneficiaries listed in public documents may become targets for scams, frauds and solicitors. Keeping your estate plan private protects them from being approached by unscrupulous individuals or organizations seeking to take advantage of their anticipated inheritance.

Indeed, public knowledge of a forthcoming inheritance can lead to beneficiaries being approached by charities seeking donations or salespeople pushing investment opportunities. While some of these inquiries may be legitimate, the pressure and constant approaches can be overwhelming and potentially lead to poor financial decisions.

A lack of privacy also can compromise strategic planning. An estate plan often includes strategic decisions made for tax benefits, asset protection or business continuity. Public disclosure of these strategies can undermine their effectiveness, expose loopholes or invite scrutiny from tax authorities or business competitors. Estate plans contain sensitive information about assets, property holdings, investments and personal wishes. Keeping this information confidential ensures that it doesn’t fall into the wrong hands, which could lead to financial losses or other forms of exploitation.

A lack of confidentiality has the potential to negatively impact minors or vulnerable beneficiaries. If minors or beneficiaries with special needs are involved, public knowledge of their expected inheritance can put them at risk. It can attract undue attention and make them vulnerable to exploitation or abuse.

Privacy also allows you to control who knows about the distribution of your assets. This is particularly important if you have unique wishes or if your asset distribution doesn’t follow traditional patterns, which might otherwise be subject to scrutiny or criticism.

In addition, many individuals find comfort in knowing that their personal affairs will not become a matter of public discussion. This psychological comfort is crucial, as it allows for peace of mind, knowing that your personal matters remain private even after your passing.

Confidentiality in estate planning is not only about protecting assets but also about safeguarding personal wishes, maintaining family dynamics and ensuring the security and well-being of beneficiaries. It's a comprehensive approach that encompasses legal, personal and security considerations, underscoring the importance of a well-thought-out, confidential estate plan.

To ensure estate plan privacy, consider employing strategies like creating a revocable living trust, which unlike a will, does not go through the public process of probate. You also can utilize non-probate transfers, such as beneficiary designations. Remember, estate planning is a personal journey, and what works for one individual may not suit another. That’s why consulting with professionals is important to ensure that your plan is tailored to your unique circumstances and aligns with your privacy goals.

 1.  How can I ensure my will remains private?

While a will typically becomes public during probate, you can maintain privacy by using a trust or other mechanisms, such as beneficiary designations, to transfer assets. This allows for the distribution of your estate outside the public probate process.

 2.  Are there any assets that cannot be kept private in an estate plan?

Certain types of asset transfers, such as those involving real estate, may require public recording. However, most other assets can be protected through trusts and non-probate transfers.

 3.  What should I communicate to my beneficiaries about my private estate plan?

It’s wise to communicate the general intentions of your estate plan and the reasons for maintaining privacy. However, avoid sharing specific details that could compromise the confidentiality of your plan.

 4.  How often should I review my estate plan for privacy?

Regular reviews, ideally annually or after major life events, are essential. This ensures that your estate plan continues to align with your privacy goals and adapts to any legal or personal changes.