When people say probate, what they are really referring to is Probate Court. People typically want to avoid Probate Court because it wastes time & money and takes what most people consider private and puts it in the public record.
3 ways to avoid probate in missouri
So how can you avoid probate? There are a number of legal strategies you
can use. Here are 3 of the most common strategies used to avoid probate in Missouri:
1. Joint Tenancy & Tenancy by the Entirety. Adding another person to your assets as a joint owner or “joint tenant with rights of survivorship” will allow your property to pass to them upon your death without going through probate. There are pitfalls to this strategy, however, to include subjecting such assets to any claims (such as lawsuits) against the co-owner and making them available to the co-owner’s creditors — all while you are still alive and planning on using the assets yourself. So this strategy can work but it also comes with risks.
2. Beneficiary Designations. Missouri allows Transfer on Death (TOD) or Pay on Death (POD) beneficiary designations to be added to bank accounts. Beneficiary designations like these are preferable to joint tenancy in that they allow you to transfer property only upon your death without giving away current ownership. One of the drawbacks, however, is that it can be
difficult to obtain an equitable distribution of property among your heirs by utilizing beneficiary designations. Additionally, understand that if you have beneficiaries listed on your assets, those assets will be distributed upon your death to the listed beneficiaries, even if your last Will and Testament states otherwise.
3. Revocable Living Trust. A Revocable Living Trust is a legal document that allows you to establish a separate entity (the trust) to “hold” legal title to your assets while you are alive, and to name Trustees to manage those assets according to the trust terms. Typically, you serve as the trustee while you are alive, managing your assets for your own benefit. Upon your disability or death, the trust terms appoint your successor trustee who then continues to manage- or distribute — the assets held in trust. A properly drafted trust can accomplish many goals, including guardianship and probate avoidance for your estate and bloodline, as well as creditor protection (including from divorce) for your children.