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Non Probate Assets: 6 Types That Can Help You Avoid Probate

Non probate assets are assets that pass directly to beneficiaries without the involvement of probate court. Learn six common types of non probate assets.

By Craig Parker

Assistant General Counsel, Trust & Will

When you begin to plan your estate, you’ll quickly encounter two different types of assets: probate assets and non probate assets. However, the distinction may not be obvious at first. The asset type dictates the manner in which a particular asset will pass to its beneficiary. Therefore, understanding the difference between probate and non probate assets is critical. Keep reading to learn why non probate assets are unique from probate assets, as well as 6 common types of non probate assets.

What Are Probate Assets vs. Non Probate Assets?

A probate asset is any type of estate property or asset that must pass through the probate process. In contrast, a non probate asset does not pass through probate court. Not only does a non probate asset remain private, it can pass directly and automatically to its beneficiary without court adjudication or intervention.

Non probate assets offer clear advantages over probate assets. Probate assets become public record and can face creditor claims during the lengthy probate process.

The key differences include:

Privacy: Non-probate assets transfer privately, while probate assets become public record
Speed: Non-probate assets transfer immediately, while probate can take months or years
Cost: Non-probate assets avoid probate court fees and related expenses

If you’re planning your estate and want to exercise more control over how assets are passed to your loved ones, then it’s wise to understand what types of assets don’t have to go through the probate process.

Read our guide Probate vs Non Probate for more information.

Why Non Probate Assets Matter for Your Family

Understanding the difference between probate and non-probate assets is more than just a legal detail—it’s about protecting your family. Structuring your assets to avoid probate offers real, meaningful benefits that provide peace of mind for you and your loved ones.

Here’s why it matters:

Saves time: Immediate transfer vs. months or years in probate
Protects privacy: Private transfer vs. public court records
Reduces costs: Avoids court fees, attorney costs, and delays

By taking the time to set up non-probate assets, you’re giving your family a final gift: a simpler, faster, and more private process during a difficult time.

6 Types of Non Probate Assets

There are several types of assets that typically don’t have to go through the probate process. Have you ever opened a financial account, after which the financial institution required you to name a beneficiary? This is typically a great clue that you’ve just created a non probate asset. However, there are other types of non probate assets that don’t necessarily work in this way.

The following reviews a variety of non probate assets you might encounter.

1. Property

Most personal property, such as real estate, jewelry, or furniture will become probate assets by default. However, you can convert property such that they become non probate assets.

One effective way is setting up a trust. When you transfer assets into a trust, the trust becomes the legal title holder, which removes them from your probate estate while you maintain control and beneficial ownership during your lifetime.

A Revocable Living Trust is the most popular option because:

You maintain full control during your lifetime
You can modify or dissolve it anytime
Assets transfer immediately to beneficiaries upon death

This is a popular estate planning tool used by many, and often for the sole purpose of avoiding the probate process. Check out our guide on What is a trust and gain more control over what happens to your assets.

2. Bank Accounts

A bank account, such as a checking or savings account, can also be a non probate asset. This largely depends on the policies of the financial institution that holds the account. For instance, certain bank accounts may have a transfer-on-death or payable-on-death policy. This allows the asset to pass directly and automatically to a named beneficiary upon the account owner’s death.

To take advantage of such policies, you must take care to designate a beneficiary. Some banks may make this action optional, while others make it mandatory. If you do name a beneficiary, be careful to keep it updated. Further, you should be careful not to create any conflicts through your estate plan, such as naming a different beneficiary for the same account in your trust or will. It’s important to note that beneficiary designations typically take precedence over instructions in your will.

Read our guide on beneficiary designations for further explanation and best practices.

3. Retirement Benefits

Retirement benefits and savings accounts also typically require a beneficiary designation, thus making it a non probate asset. This might include your employer-sponsored pension plan, IRA, 401(k), or a retirement savings account that you set up on your own.

Being able to distribute your retirement savings and benefits directly to your loved ones after your passing can be a great benefit. When a family member passes away, the sudden loss of income can create financial strain for their partner and dependents. Passing a source of income directly to a loved one outside of the probate process can help provide some financial stability and comfort during a challenging time.

4. Life Insurance Policies

Life insurance policies are a well known type of non probate asset. You may not have realized that they were a non probate asset per se, but you’re likely familiar with the concept of how a life insurance policy works.

By purchasing a life insurance policy, you’re ensuring that your loved ones will receive financial proceeds when you pass away. This is done by taking out a policy, naming your beneficiaries, and paying into the policy over time. Many individuals take out a life insurance policy for the sole purpose of providing financial relief for loved ones in the event that they pass away.

A life insurance policy typically doesn’t pass through the probate process and the proceeds are paid out automatically to beneficiaries. However, if there’s no designated beneficiary, the beneficiary can’t be located, or the beneficiary has passed away, the policy proceeds may become part of your estate and go through probate. This is why it’s important to keep your beneficiary designations current.

5. Any Other Assets That Are Owned Jointly With Others

Assets that are co-owned with right of survivorship don’t pass through probate. This includes joint tenancy with right of survivorship and tenancy by the entirety. When one owner passes away, their share of ownership in that asset will automatically transfer to the surviving co-owner(s).

A common example of jointly owned property is real estate. For instance, a married couple could buy a house together with right of survivorship. If one of them were to pass away, the property title wouldn’t go through probate to determine whether it should be passed to an outside individual or entity. Instead their share of the property interest will automatically get absorbed by the surviving co-owner.

It’s important to note that not all jointly owned property avoids probate. Property held as “tenants in common” doesn’t include right of survivorship, meaning each owner’s share will pass according to their will or state law, requiring probate. The ownership document must specifically state that it includes right of survivorship for the property to avoid probate.

6. Any Other Assets That Have Post-Death Designation in Place

There are also assets that can have a post-death designation in place, such as the right of survivorship, or transferable- or payable-on-death. Examples of assets with such designations include specific types of house deeds and financial accounts.

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Protect Your Assets - Update Your Estate Plan Today

Understanding asset types can shape your family’s inheritance experience. Most people want to maximize non-probate assets to avoid the lengthy, expensive probate process.

Here’s why this matters:

Faster transfers: Your family gets immediate access to funds
Lower costs: No probate court fees or extended legal processes
Less stress: Simplified process during a difficult time

Luckily, there are solutions. First and foremost, there are a number of asset types that typically don’t pass through probate. This includes life insurance policies, bank accounts, and investment or retirement accounts that require you to name a beneficiary. The proceeds are paid out directly to your named beneficiary when you pass away without having to pass through probate.

Second, there are methods that you can leverage to convert probate assets into non probate assets. One common way to do this is by setting up a trust and transferring as many assets into the trust as possible. Not only do these assets not have to go through probate, you get to control the timing and manner in which these assets are distributed to your loved ones. Many trust owners rest more easily at night knowing that they've exerted control about what should happen to their legacy.

You can ensure your assets are protected and covered, whether you choose to set up a will, a trust, or both! If you choose to set up a trust, the process is easy and accessible. Find out how to set up an online trust today!

Is there a question here we didn’t answer? Visit our website to learn more!

Trust & Will is an online service providing legal forms and information. We are not a law firm and we do not provide legal advice.

Frequently Asked Questions About Non Probate Assets

Which Assets Automatically Avoid Probate?

Assets with named beneficiaries or direct transfer designations avoid probate, including trust assets, life insurance policies, retirement accounts, and POD bank accounts.