Protecting Your Assets From Probate

April 27, 2018

Probate can be costly and time consuming. We’ll show you a few potential ways to save.


When Elvis Presley died, his estate was worth more than $10 million dollars1. Then it went through probate.


After appraisal costs, legal fees, executor’s fees and estate taxes, “The King’s” estate was reduced to $3 million.2 Because of improper estate planning, a whopping 73 percent of Elvis’ estate was wiped out. So what did all that money pay for? And how can you avoid some of the same mistakes? Let’s find out.


Probate is the (usually lengthy) process of proving a will is valid, clearing your estate of any debt and making sure no one challenges it. All of this takes place in court, which adds to the costliness.


But there are ways to reduce or eliminate costs associated with the complicated legal process. One of the most efficient includes establishing a trust. Assets and property within a properly drafted trust don’t have to pass through probate. On top of that, assets are passed on relatively quickly following death, especially when compared with probate. In addition, assets potentially have more protection from creditors when placed in a trust.


But trusts aren’t your only option. If you choose not to establish a trust, there are several ways you can reduce costs. If you have a 401(k), an IRA, a life insurance policy or all three, you have three separate beneficiaries to name. By routinely updating your beneficiary designation, you avoid unwanted inheritances and ensure your wishes are carried out. Assets that pass through beneficiary designations typically aren’t subject to probate, which makes their accuracy even more crucial.



You can also choose to own assets jointly with someone else. Jointly owned property, from stocks to houses, may be passed onto the survivor automatically. Many brokerage houses and banks also allow you to name a beneficiary on your personal accounts by establishing a TOD (Transfer on Death) account. It’s one more way to ensure your assets pass relatively quickly and easily to whomever you wish. Upon death, your accounts and their contents will be passed to whomever you’ve named.


One other option is to gift your assets to family or friends before you pass away. By gifting the maximum tax-free amount each year ($14,000 in 2016), you reduce the amount of your estate, which, in turn usually reduces the amount of probate costs since they are generally based on the total estate value. Gifts may be subject to a “look-back” period, so consult with your tax and estate professionals.


By properly planning your estate with a financial professional and an estate planning attorney, you may be able to decrease probate costs and avoid costly mistakes. Not many people like to discuss their own mortality. But the thought of family, friends or a charity losing large percentages of their inheritance to costs, fees and taxes should encourage anyone to start planning.


While Elvis’ estate may have been improperly managed early on, it has become a major success story since being bought out by his former wife, Priscilla, and their daughter, Lisa Marie. With proper management, it grew from a paltry $3 million to more than $300 million today, with 85 percent ownership under Authentic Brands Group and the other 15 percent with Lisa Marie.3


The lesson to be learned lies in the stark contrast between proper and improper estate management, and shows how important an estate plan is, whether you’re “the King,” or not.


1 Back Room Technician, “Estates of Famous People” chart 2 Stevens, Sue. June 30, 2005. Avoid the Estate Planning Blunders of Marilyn and Elvis. 3 Yan, Sophia. Nov. 20, 2013. “Sold! Elvis Presley Inc. has a new owner”; and Celebrity Net Worth: by Securities America


Back to my page

Share on Facebook
Share on Twitter
Please reload

Featured Posts

Deciphering Financial Aid Alphabet Soup

July 7, 2017

Please reload

Recent Posts

October 26, 2018

Please reload

Please reload

Search By Tags
Please reload

Follow Us
  • Facebook Basic Square
  • Twitter Basic Square
  • Google+ Basic Square

801 S. Fillmore, Suite 530

Amarillo, Texas 79101

Click to check the background​
of this firm FINRA's BrokerCheck

The BBB has determined this business meets accreditation standards, which include a commitment to make a good faith effort to resolve any consumer complaints. BBB Accredited Businesses pay a fee for accreditation review/monitoring and for support of BBB services to the public. BBB accreditation does not mean that th ebusiness products or services have been evlauted or endorsed by the BBB, or that the BBB has made a determination as to the business product quality or competency in performing services.

Navigation Financial Group is not a CPA Firm. Advisor Representatives are Registered Representatives of and offer securities through Securities America, Inc., member FINRA/SIPC. Planning and Advisory Services available through Securities America Advisors, Inc. $ymbil is offered by Ladenburg Thalmann Asset Management, Inc. (LTAM). Navigation Financial Group and its affiliates are independent of Securities America and LTAM. Securities America and its representatives do not provide tax or legal advice; therefore, it is important to coordinate with your tax or legal advisor regarding your specific situation. This site is published for residents of the United States and is for informational purposes only and does not constitute an offer to sell or a solicitation of an offer to buy any security or product that may be referenced herein. Persons mentioned on this website may only offer services and transact business and/or respond to inquiries in states or jurisdictions in which they have been properly registered or are exempt from registration. Not all products and services referenced on this site are available in every state, jurisdiction or from every person listed. Not FDIC Insured, No Bank Guarantees, May Lose Value. Not a Deposit and Not Insured by any Government Agency. As of January 1, 2020, the California Consumer Privacy Act (CCPA) suggests the following link as an extra measure to safeguard your data: Do not sell my personal inforamation.

© 2020   |   All Rights Reserved