If you have a life insurance policy or are planning to have one, the most burning thought would be how you may save money on unnecessary expenses. Besides, you also think on how to speed up the process of transferring assets to your beneficiaries by avoiding the probate process.
Such thought can better be tackled by an experienced estate planner or a probate attorney. The process by which the deceased assets are transferred to the beneficiaries is always costly and overwhelming. That’s why one should take the correct measures to save their beneficiaries of this hassle.
What Is Probate?
Probate is a legal process by which the deceased person’s assets are transferred to the beneficiaries. The majority of people who look for top insurance companies in Anchorage wonder whether their life insurance payout has to go through probate before it reaches the beneficiaries. The answer to this question depends on several factors. Some of these factors include:
- Naming your beneficiaries in the life insurance policy: If you gave the right information concerning your beneficiaries, the payout can’t be probated. Instead, it goes directly to the beneficiaries.
- Whether you have named the beneficiaries in the policy: If you never named any beneficiary on your policy, the payout will enter probate with other assets and can be used to pay off debts.
- Whether the beneficiaries are alive: Where beneficiaries have died, the payout becomes part of the estate, and any debts can be paid off from the payout.
How Does Probate Work In Alaska?
There are so many ways one can avoid probate in Alaska. You can use the below methods to ensure all your assets goes directly to your beneficiaries without passing through probate court. Some of the ways include:
- Having a recoverable living trust: You can avoid probate by making a living trust to any assets you own. You only need to have a trust document with a named trustee who can take over your assets after your demise. This ensures that in case of death, the property will be controlled under the terms of the trust. Being a trustee of the trust means that all the assets can be transferred to the trust beneficiaries without probate court proceedings.
- Payable on death designations for bank accounts: You have the right to convert your bank accounts or any other assets accounts to payable–on–death accounts. With this, you can be assured that the money will be channeled directly to your beneficiaries after your death without having to go through probate court proceedings.
- Consider joint ownership: You can choose to own assets jointly with someone else. Joint ownership is an easy way to avoid probate as the surviving party takes the property. In Alaska, you may choose to have joint ownership either through tenancy by the entirety, joint tenancy or through community property with right of survivorship.
- Transfer –on-death registration for securities and deeds for real estate: If you hold your brokerage account through transfer on death, your beneficiaries automatically inherit the money on your accounts. Likewise, you can choose to leave your real estate with beneficiary deeds by signing and recording the deed.
The best part is that even if you make no efforts to avoid probate, you still stand a chance to avoid it through small estate qualifications procedures. The process is made more accessible through probate shortcuts in Alaska, which makes it easier to transfer property left by the deceased. Beneficiaries can transfer a large amount of money through a simplified probate procedure and avoid going to court. The beneficiary does this by preparing an affidavit, which is used to release the assets. However, one must file a written request with a local court to request permission to use the simplified procedure.
Even though what happens during probate court proceedings is clerical, it makes more sense to avoid probate altogether. However, if it befalls on you that you have to go through probate court proceedings, you need to be aware of the probate fees.
How Much Will Probate Cost?
The leading key players in a probate process are the attorneys and executors. They are paid a certain percentage of the estate and the amount varies from state to state. For any probate process in Alaska, the below fees must be incurred:
- Attorney’s fees: The amount is charged per hour, and sometimes, the attorney asks for retainer’s fees. If the financial affairs of the deceased are in a mess, the amount may hike up.
- Executor’s fees: The executor can either get paid a lump sum fee or a percentage of the estate. However, the executor can waive the fee if they inherit a good amount of your property.
In most cases, there is no conflict when it comes to probate court proceedings. But it’s prudent to have legal representation. If you have any questions regarding Alaska’s probate process, you can consult an experienced probate lawyer.