Asset:

What you can do to avoid Probate:

Real estate

Transfer to a living trust;

Hold property in joint tenancy with a co-owner or tenancy by entirety with your spouse; or

Hold as community property (or community property with right of survivorship) with your spouse.

Bank accounts, cds

Name a payable-on-death beneficiary;

Hold in joint tenancy with a co-owner or tenancy by the entirety with your spouse; or

Hold as community property (or community property with right of survivorship) with your spouse.

Stocks and bonds

Name a transfer-on-death beneficiary;

Transfer to a living trust;

Hold in joint tenancy with a co-owner or tenancy by the entirety with your spouse; or

Hold as community property (or community property with right survivorship) with your spouse

Government bonds

Register ownership in beneficiary form;

Transfer to a living trust;

Hold in joint tenancy with a co-owner or tenancy by the entirety with your spouse;  or

Hold as community property (or community property with right survivorship) with your spouse.

Cars and other vehicles

Register in transfer-on-death form;

Hold in joint tenancy with a co-owner or tenancy by the entirety with your spouse;

Hold as community property (or community property with right of survivorship) with your spouse; or

Transfer to a living trust.

Retirement accounts (IRAs, 401(k) accounts)

Name a beneficiary to inherit at your death.

Payable-on-death Accounts at a Glance

Pros

Cons

They're easy to create.

You can't name an alternate beneficiary.

There's no limit on how much money you can leave this way.

Designating a beneficiary for a bank account costs nothing.

It's easy for the beneficiary to claim the money after the original owner dies.

Beneficiary Registration at a Glance

Pros

Cons

Easy to create.

Your broker might not allow you to name an alternate beneficiary.

Designating a beneficiary costs nothing.

It's easy for the beneficiary to claim the securities after the original owner dies.

Joint Ownership Methods

Methods of Holding Title:

Avoids Probate?

Joint tenancy with right of survivorship

Yes

Tenancy by the entirety

Yes

Community Property

No, except in states where right of survivorship can be added

Community Property with right of survivorship

Yes

Tenancy in common

No

Partnership

No

If You're Not Sure How You Hold This

Kinds of Property:

Where to Look:

Real Estate

Your deed

Bank account

The passbook, or the registration card on file at the bank

Brokerage account

A statement for the account

Car, boat or other vehicle

Certificate of ownership (title) or registration slip

Individual stocks or bonds

Stock certificates or bonds

Revocable Living Trusts at a Glance

Pros

Cons

A trust works for anything you own: cars, real estate, bank accounts, stocks and more.

A trust is more work to create and maintain than other probate-avoidance devices, because property must be transferred, in writing, to the trustee.

You can name alternate beneficiaries (unlike many probate-avoidance techniques).

You may run into hassles if you want to refinance property owned by the trust. 

You can amend or revoke the trust at any time.

It's unlikely, but in some places you might have to pay a transfer tax if you put real estate in the trust.

There is no waiting period after death; property can be transferred to beneficiaries quickly.

A trust is harder to attack in court than a will.

Spouses can make one combined trust.

If you become incapacitated, the successor trustee can take over management of trust property without court authorization.

Amending or Revoking Your Living Trust

You may need to amend if…..

You may need to revoke if….

You get married.

You want to make extensive, possibly confusing revisions.

You have a child.

You get divorced.

You add valuable property to the trust.

You change your mind about whom you want to inherit certain items of trust property, or whom you want to serve as successor trustee.

You move to a state with different laws about marital property or property management for young beneficiaries.

Your spouse dies.

A major beneficiary dies.

Gift-giving at a Glance

Pros

Cons

It's easy to do.

Once you give property away, it's gone for good.

You get to see your gifts enjoyed by the recipients.

Large gifts - more than $10,000 per recipient per year - require a federal gift tax return and may be subject to tax.

Giving property away saves estates taxes, if your estate will be large enough to be subject to them.

Gift to minors are subject to special rules to keep their tax-free status.

Asset:

What you can do to avoid Probate:

Real estate

Transfer to a living trust;

Hold property in joint tenancy with a co-owner or tenancy by entirety with your spouse; or

Hold as community property (or community property with right of survivorship) with your spouse.

Bank accounts, cds

Name a payable-on-death beneficiary;

Hold in joint tenancy with a co-owner or tenancy by the entirety with your spouse; or

Hold as community property (or community property with right of survivorship) with your spouse.

Stocks and bonds

Name a transfer-on-death beneficiary;

Transfer to a living trust;

Hold in joint tenancy with a co-owner or tenancy by the entirety with your spouse; or

Hold as community property (or community property with right survivorship) with your spouse

Government bonds

Register ownership in beneficiary form;

Transfer to a living trust;

Hold in joint tenancy with a co-owner or tenancy by the entirety with your spouse;  or

Hold as community property (or community property with right survivorship) with your spouse.

Cars and other vehicles

Register in transfer-on-death form;

Hold in joint tenancy with a co-owner or tenancy by the entirety with your spouse;

Hold as community property (or community property with right of survivorship) with your spouse; or

Transfer to a living trust.

Retirement accounts (IRAs, 401(k) accounts)

Name a beneficiary to inherit at your death.

Payable-on-death Accounts at a Glance

Pros

Cons

They're easy to create.

You can't name an alternate beneficiary.

There's no limit on how much money you can leave this way.

Designating a beneficiary for a bank account costs nothing.

It's easy for the beneficiary to claim the money after the original owner dies.

Beneficiary Registration at a Glance

Pros

Cons

Easy to create.

Your broker might not allow you to name an alternate beneficiary.

Designating a beneficiary costs nothing.

It's easy for the beneficiary to claim the securities after the original owner dies.

Joint Ownership Methods

Methods of Holding Title:

Avoids Probate?

Joint tenancy with right of survivorship

Yes

Tenancy by the entirety

Yes

Community Property

No, except in states where right of survivorship can be added

Community Property with right of survivorship

Yes

Tenancy in common

No

Partnership

No

If You're Not Sure How You Hold This

Kinds of Property:

Where to Look:

Real Estate

Your deed

Bank account

The passbook, or the registration card on file at the bank

Brokerage account

A statement for the account

Car, boat or other vehicle

Certificate of ownership (title) or registration slip

Individual stocks or bonds

Stock certificates or bonds

Revocable Living Trusts at a Glance

Pros

Cons

A trust works for anything you own: cars, real estate, bank accounts, stocks and more.

A trust is more work to create and maintain than other probate-avoidance devices, because property must be transferred, in writing, to the trustee.

You can name alternate beneficiaries (unlike many probate-avoidance techniques).

You may run into hassles if you want to refinance property owned by the trust. 

You can amend or revoke the trust at any time.

It's unlikely, but in some places you might have to pay a transfer tax if you put real estate in the trust.

There is no waiting period after death; property can be transferred to beneficiaries quickly.

A trust is harder to attack in court than a will.

Spouses can make one combined trust.

If you become incapacitated, the successor trustee can take over management of trust property without court authorization.

Amending or Revoking Your Living Trust

You may need to amend if…..

You may need to revoke if….

You get married.

You want to make extensive, possibly confusing revisions.

You have a child.

You get divorced.

You add valuable property to the trust.

You change your mind about whom you want to inherit certain items of trust property, or whom you want to serve as successor trustee.

You move to a state with different laws about marital property or property management for young beneficiaries.

Your spouse dies.

A major beneficiary dies.

Gift-giving at a Glance

Pros

Cons

It's easy to do.

Once you give property away, it's gone for good.

You get to see your gifts enjoyed by the recipients.

Large gifts - more than $10,000 per recipient per year - require a federal gift tax return and may be subject to tax.

Giving property away saves estates taxes, if your estate will be large enough to be subject to them.

Gift to minors are subject to special rules to keep their tax-free status.