Avoiding Probate: Personal Property

Avoiding Probate: Personal Property

One of the biggest problems with setting up a living trust is that people forget to put their property into it. After the trust agreement is signed, all of the person's property must be transferred to the trust. Usually, all of the assets are listed on a schedule of assets that goes with the trust. But for some types of property, such as real estate, the title must be reregistered. This means getting a new deed. Also, bank and brokerage accounts must be retitled, rather than just listed on the schedule of assets.

Personal property ownership is not registered or documented by a title certificate. As a result, ownership of such items can be questionable. For example, what if you own a valuable coin collection and after your death, your spouse claims ownership as joint property, while your child claims inheritance as personal property under your will?

To avoid problems like this, you can specifically list personal items you wish to give people in your will.

In some cases, you might be more concerned that the title to your property is separate. For example, in California and many other western states, all property acquired during marriage is considered community property, and each spouse has 50% interest in it. If you and your spouse want to keep your property separate (for example, to leave it to your separate children), you should discuss this with an attorney.