After your death, your estate usually has to go through probate. However, some of your assets may be non-probate assets.
During the probate process, the executor of your estate generally has to collect all your assets and distribute them to the beneficiaries. Some of your assets may actually be exempt from the probate process. This is because they already have a designated beneficiary who will automatically receive the asset after your death. Non-probate assets may fall into two categories.
According to the Texas legislature, assets that belong to both you and your spouse are typically considered to be non-probate assets. These joint assets may include your home and your joint checking and savings accounts. This is because you and your spouse are the joint owners. After your death, your spouse becomes the primary owner of these assets.
Your community property may still need to pass through probate. You and your spouse may have a verbal agreement about what will happen to some of these assets. However, verbal agreements are generally not legally binding. You may need to include specific instructions about these assets in your will.
Some of your financial assets may not need to pass through probate. These include your retirement accounts and your life insurance. If you receive a pension, this also may not need to go through probate. Additionally, your investment accounts are usually exempt. This is because you made a contract with a third party, such as a life insurance company. Your contract states who will receive the money after your death. The third party distributes these assets to the beneficiary and bypasses probate.
You usually cannot change the beneficiary of a non-probate asset through your will. Because of this, you should go through your non-probate assets carefully to make sure that each asset will go to your desired beneficiary.