In most situations, joint ownership is just not a good idea and weâ€™ll discuss that below. But, first, we want to emphasize that joint ownership doesnâ€™t really avoid probate.
Joint Ownership May Delay Probate, but it Doesnâ€™t Avoid It
Joint ownership may delay probate, but it wonâ€™t avoid it.Â Hereâ€™s an example:
Meghan and John put their assets in joint names to avoid probate.Â John died and the assets to Meghan without probate.
A few years later, Meghan died.Â Because the assets formerly owned jointly were now in Meghanâ€™s individual name, probate was guaranteed.
If you think, â€œWell, thatâ€™s okay.Â When one of us dies, the other can do good estate planning then and avoid probateâ€ consider this example:
Ruth and Kirk put their assets in joint names to avoid probate.Â
They were both killed in a car crash and all assets went through probate.Â Â Â Â Â Â Â Â Â Â Â
Joint ownership only avoids probate if there is a surviving joint owner.Â And, as we illustrate in the Meghan and John example, joint ownership only really delays probate.Â There is no probate avoidance.
How to Avoid Probate
For many people, the best way to avoid probate is with a fully funded revocable living trust. The trust offers benefits and minimal real pitfalls; it does avoid probate for all assets that the trust owns. This is key. Your assets must be in the name of the trust to avoid probate.
If you own assets jointly, consult with a qualified estate planning attorney to determine the best way to completely avoid probate. Owning assets jointly wonâ€™t only often does not work.