How Non-Probate Assets Work (and Why You Should Review Yours)

When you’re planning your estate, it’s easy to assume that everything you own will be covered by your will. But some assets actually follow their own rules and don’t go through probate at all. These are called non-probate assets, and knowing how they work can help you make sure your estate plan does exactly what you want it to. Taking a few minutes to review your beneficiary designations can make a big difference for the people you care about.

What Are Non-Probate Assets?

Non-probate assets are those that transfer automatically to someone else at the time of your death, without going through the court-supervised probate process. This means they typically avoid the delays, costs, and public nature of probate administration.

These assets are controlled by contracts or account designations instead of your will. Even if your will says something different, the beneficiary listed on the account will still take priority.

Common Types of Non-Probate Assets:

1. Life Insurance Policies

Life insurance payouts go straight to the person you’ve named as your beneficiary. That means they don’t have to wait for probate to get the funds. It’s a good idea to double-check who’s listed, especially after big life changes like getting married, divorced, or having a child.

2. Retirement Accounts (401(k), IRA, etc.)

Your retirement accounts also pass directly to the people you’ve named as beneficiaries. If you forget to name someone or if that person has passed away, the account could end up in probate, which can cause extra hassle and delay.

3. Bank Accounts with POD (Payable-on-Death) Designations

Many banks allow you to add a Payable-on-Death (POD) designation to checking or savings accounts. When you pass away, the money goes directly to the person you named and no court process is needed.

4. Real Estate or Vehicles with TOD (Transfer-on-Death) Designations

In Ohio, you can make it easier for loved ones to inherit your home or car without going through probate.

For real estate, you can record a Transfer-on-Death (TOD) designation affidavit with your county recorder’s office. It names who should get the property when you pass away. You still own and control the property while you’re alive, and you can change or cancel the designation anytime.

For vehicles, Ohio lets you add a TOD beneficiary directly on your car title. You just fill out a short form at the title office, and when the time comes, your beneficiary can retitle the vehicle in their name without going through court.

Note: In Ohio, if there isn’t a TOD designation, a surviving spouse can still automatically claim up to two vehicles (within certain value limits) without going through probate. This can be done using a simple affidavit through the local title office.

Both of these options can help make the transfer process faster, simpler, and less stressful for your loved ones.

5. Jointly Owned Property

Assets held in joint tenancy with right of survivorship automatically pass to the surviving owner. This is common with homes, bank accounts, and other shared assets.

Why Reviewing Beneficiary Designations Is So Important

It’s easy to set up a beneficiary when you first open an account or buy a life insurance policy and then forget all about it. But over time, life changes. You might get married, divorced, have children, or experience other major milestones that could make your old choices outdated.

Since non-probate assets are controlled by the beneficiary forms on file (not your will), it’s important to check them regularly. Even if your will says something different, the person listed on your account will still receive the asset.

Taking a few minutes each year to review your beneficiary designations can save your loved ones time, money, and potential conflict later on. It’s one of the simplest but most powerful ways to make sure your estate plan still reflects your wishes.

What Happens If You Don’t Designate Beneficiaries

If you don’t name beneficiaries for your non-probate assets, those assets lose their “non-probate” status and will instead become part of your probate estate in Ohio. This means they’ll be subject to the court-supervised probate process, which can take time, involve additional costs, and make your estate matters public record. For example, if your life insurance policy, retirement account, or POD/TOD account doesn’t have a valid beneficiary listed—or if your designated beneficiary has passed away—those funds or assets will have to go through probate before being distributed according to your will or Ohio’s intestacy laws. Keeping your beneficiary designations up to date ensures that your assets transfer directly and efficiently to the people you intend.

How Non-Probate Assets Fit Into Your Estate Plan

Even though non-probate assets pass directly to your beneficiaries, they’re still an important part of your overall estate plan. It’s easy to forget that these assets can make up a large portion of your wealth, so it’s worth taking the time to make sure everything fits together.

Your will doesn’t control who gets these assets, which means your beneficiary designations need to match your bigger plan. If they don’t, your assets might end up going to someone you didn’t intend.

A quick review with an estate planning attorney or financial advisor can help you make sure your designations, will, and other documents all work together. That way, you can feel confident that your loved ones will be cared for exactly as you intended.

Final Thoughts

Understanding how non-probate assets work can make a big difference in how smoothly things go for your loved ones after you’re gone. Taking the time to review your beneficiary designations and making sure everything lines up with your overall estate plan is a simple step that can prevent confusion, delays, and even disputes later on.

At Ballinger Legal, we’ll help you review all of your assets and talk through the best strategy for probate avoidance. We’ll also look at situations involving minor beneficiaries, since leaving assets directly to a child can create complications. In those cases, setting up a trust may be the best way to protect their inheritance and ensure it’s managed responsibly until they come of age.

Estate planning doesn’t have to be overwhelming. With the right guidance, you can create a plan that gives you peace of mind and makes things easier for the people you care about most.

Contact Ballinger Legal today to schedule a consultation and start building a plan that works for you and your family.