At your death, how will your assets be distributed? Who will
settle your affairs? Will there be a need for
probate? Learn more
about wills, living trusts, and inexpensive ways to
When someone dies, who becomes the owner of his
property? A bank account for instance.
During this person's life, only he could take money out
of the account. Or perhaps someone else had the
right to access the account under power of attorney or
as joint owner. What rights do these people
have after the owner has died?
Example One: Robert and Joan have a bank
account together. It is known as a joint account.
The statement reads Robert OR Joan. At Robert's
death Joan becomes the sole owner of the account.
She can close the account if she wishes.
Example Two Robert has a bank account in his
name alone. He named Joan as a "Pay on Death"
beneficiary. The bank calls this a custodial
account, or a transfer on death account, or a totem
trust account. At Robert's death Joan will provide
the bank with a death certificate and the money in the
account will be given to her.
Example Three. Robert created a trust.
His bank account is owned by his trust. The
statement reads: "The Robert Revocable Trust."
The trust says that during Robert's life he is the
trustee and can access the bank account. It says
that at Robert's death Joan automatically becomes the
Trustee. It also says that when Robert dies the
Trustee must close the bank account and give the money
to Stephen. At Robert's death, Joan provides the
bank with the death certificate and shows them the Trust
provision saying that she is the new Trustee. The
bank closes the account and gives Joan the money.
Joan gives the money to Stephen.
Example Four: Peter has a bank account in his
name alone, but gave Marilyn the power to access the
account so she could pay his bills if became ill.
The statement reads Peter. Marilyn, POA .
(Power of Attorney) At Peter's death,
Marilyn's right to access the account ends.
After Peter's death no one can access the account
without the permission of a probate court judge.
Example Five: Peter has a bank account in his
name alone. No one has the right to access the
account. After Peter's death no one can access the
account without the permission of a probate court judge.
Who will get Peter's bank account?
Example One: Peter had a will. The will
says that Peter wants Marilyn to handle his affairs
after his death. It says that he wants Philip to
get the money in his bank account. At Peter's
death Marilyn would file the will with the Probate
Court. A judge would appoint her as Executor of
the Estate of Peter. She would show the bank the
document that names her "Executor and the bank
would them allow her to close the account. She
then transfers the money to Philip.
Example Two: Peter didn't have a will.
The family would tell the Probate Court that there is no
will. The judge would appoint someone as Executor
of the Estate. That person would be able to
close the bank account. She would then transfer
the money to the person that New Hampshire law says is
the rightful owner - the spouse, children, etc.
This is known as intestate succession.
Notice that if a bank account is held jointly, is a
transfer on death account, or is held in the name of a
trust the account is transferred at death without the
need for probate. If the account is held in a
single name, even if someone has power of attorney, the
probate court must become involved. EVEN IF
THERE IS A WILL.
A will allows you to indicate who you want to handle
your affairs at your death (by naming an executor),
indicate who you want to act as guardian of minor
children, and indicate who you want your property
distributed to. If you do not have a will,
the judge would appoint as executor or guardian the
person she considers best for the position - but would
have no guidance from you. If you do not have a
will, state law prescribes
who inherits your
The validity of a will is determined by the probate
court after death. (N.H. does not have a will registry
where wills are filed before death)
Although the law does not require that an attorney
prepare a will, it's validity will depend on adherence
to complex law. Of all the do-it-yourself
projects, preparing a will may be the most risky.
Remember when you need to use the will, you won't be
around to interpret it! The New Hampshire Bar
Association offers information on wills in the guide:
"Wills and Trusts"
The Probate Process
The Probate Court is a county court. The
process will take place in county in which the deceased
resided at the time of death. The process is
public, meaning that the will becomes a public document.
A statement is filed with the court indicating all the
assets the decedent owned. This document is made
public as well. There are different forms of
probate administration, depending on the circumstances.
Each form of administration has different forms,
requirements, and fees.
The process is most simplified if:
1) the decedent dies with a will and the surviving
spouse (or, if no spouse, an only child)
is named in the will as the sole beneficiary and is
appointed to serve as executor; or
(2) the decedent dies without a will and the
surviving spouse (or, if no spouse, an only child) is
heir and is appointed to serve as administrator.
Under these circumstances there will be a Waiver of
Full Administration and the estate can be closed after
six months if the executor files an affidavit certifying
that there are no outstanding debts.
Voluntary or Small Estate Administration
The process is also simplified if the estate does not
include real estate and is small - a value of
$10,000 or less. This is known as "Voluntary
If the estate contains real estate, or is valued over
$10,000 and the conditions for a Waiver of
Administration don't exist regular administration will
The New Hampshire Bar Association and the
Administrative Judge of the Probate Court have published
a guide which explains the probate process:
"Administering and Estate" It is not
necessary to hire an attorney however, Regular
Administration involves many forms and filings which can
be confusing. The court clerks and staff are
helpful but they are not able to give legal advice.
Because the probate process is public, time
consuming, and possibly expensive, many people take
steps to avoid probate.
Assets which name a beneficiary.
It is possible to name beneficiaries on many
accounts. When you purchase life insurance, IRAs,
or annuities you are asked to name one or more
beneficiaries. You should be sure to name a
secondary beneficiary in case the person you name dies
before you. If no secondary beneficiary is named,
the asset would be payable to "the estate" - which
means probate would be necessary.
You may also ask that bank accounts and brokerage
accounts be set up to pass to a beneficiary at your
death. Understand that many banks or investment
advisors will not automatically offer this option and
there may be a cost. Stocks and bonds can
also have the "transfer on death" feature.
Remember, someone named as a POA on your account does
not have the right to the account, or even to access the
account, after your death.
It is common to hold real estate and financial
accounts jointly. When one person dies, the other
becomes the sole owner. However, just because two
names are listed on an account or in a deed does not
guarantee that the asset will be considered jointly
held. If the deed does not say "as joint
tenants with rights of survivorship" when one person
dies his share of the property passes to his heirs - in
probate! Financial accounts might also be held as
tenants in common rather than jointly. If the
statement does not say "or" between the two names it is
likely that the account is not considered joint.
It is not advisable to own an asset jointly if the
sole reason is to avoid probate. A joint owner has
full right to the account and could deplete the funds
entirely. There are significant tax and Medicaid
law implications when a name is added to an account or
deed. Making an account a transfer on death
account is the better solution. A deed to
real estate, however, can not name a beneficiary.
If you own real estate and want to avoid probate, and if
you don't own the real estate jointly with a life or
business partner, usually the best solution is to create
a revocable trust.
A Revocable or "Living" Trust is a will substitute.
(IMPORTANT: The "Living Trust" is often
confused with the "Living
Will" A living will has to do with end of life
medical decisions. It has nothing to do with
financial assets or probate! )
Like a will, a Living Trust directs who you want your
property to go to at your death. After a living
trust is created the trust must be funded.
Financial Institutions are instructed to change
ownership of accounts from the individual to the trust.
A deed is prepared transferring title to real estate to
the trust. If a trust is created and all
individually held assets are transferred to the trust,
probate will be avoided.
Avoidance Check List
Take these precautions in order to avoid probate at
your death. If you are acting as agent under power
of attorney, it is likely you will have the power to
accomplish many of these tasks on behalf of your loved
- Financial accounts, stocks, and bonds, are held
jointly, in trust, or transfer on death to a
- Real estate is held jointly with a life or
business partner or is held in trust
- Life Insurance, IRAs, Annuities, Veterans
Benefits, Pensions, name a beneficiary - NOT
- All assets which name a beneficiary name a
secondary beneficiary in the event the primary
beneficiary predeceases you
- Long-term care insurance, pensions, etc.,
sometimes have a small death benefit. Check to
be sure that a primary and secondary beneficiary has