How to save your family time, money, and hassle by using probate-avoidance tools available in New Jersey.
Updated by Valerie Keene, Attorney · University of Arkansas School of Law
Probate court proceedings (during which a deceased person's assets are transferred to the people who inherit them) can be long, costly, and confusing. It's no wonder so many people take steps to spare their families the hassle. Different states, however, offer different ways to avoid probate. Here are your options in New Jersey.
Living Trusts
In New Jersey, you can make a living trust to avoid probate for virtually any asset you own—real estate, bank accounts, vehicles, and so on. You need to create a trust document (it's similar to a will), naming someone to take over as trustee after your death (called a successor trustee). Then—and this is crucial—you must transfer ownership of your property to yourself as the trustee of the trust. Once all that's done, the property will be controlled by the terms of the trust. At your death, your successor trustee will be able to transfer it to the trust beneficiaries without probate court proceedings.
Joint Ownership
If you own property jointly with someone else, and this ownership includes the "right of survivorship," then the surviving owner automatically owns the property when the other owner dies. No probate will be necessary to transfer the property, although of course it will take some paperwork to show that title to the property is held solely by the surviving owner.
In New Jersey, these forms of joint ownership are available:
- Joint tenancy. Property owned in joint tenancy automatically passes to the surviving owners when one owner dies. No probate is necessary. Joint tenancy often works well when couples (married or not) acquire real estate, vehicles, bank accounts or other valuable property together. In New Jersey, each owner, called a joint tenant, must own an equal share.
- Tenancy by the entirety. This form of joint ownership is like joint tenancy, but it is allowed only for married couples and registered domestic partners in New Jersey. (In New Jersey, couples 62 years of age or older can register for a domestic partnership if they meet certain requirements.)
Payable-on-Death Designations for Bank Accounts
In New Jersey, you can add a "payable-on-death" (POD) designation to bank accounts such as savings accounts or certificates of deposit. You still control all the money in the account—your POD beneficiary has no rights to the money, and you can spend it all if you want. At your death, the beneficiary can claim the money directly from the bank without probate court proceedings.
Transfer-on-Death Registration for Securities
New Jersey lets you register stocks and bonds in transfer-on-death (TOD) form. People commonly hold brokerage accounts this way. If you register an account in TOD (also called beneficiary) form, the beneficiary you name will inherit the account automatically at your death. No probate court proceedings will be necessary; the beneficiary will deal directly with the brokerage company to transfer the account.
Transfer-on-Death Deeds for Real Estate
New Jersey does not allow real estate to be transferred with transfer-on-death deeds.
Transfer-on-Death Registration for Vehicles
In 2023, New Jersey began to allow transfer-on-death registration of vehicles. If you register your vehicle this way, the beneficiary you name will automatically inherit the vehicle after your death. No probate court proceeding will be necessary.
Simplified Probate Procedures
Even if you don't do any planning to avoid probate, your estate may qualify for New Jersey's simplified "small estate" probate procedures. For more details, see Probate Shortcuts in New Jersey. For more on avoiding probate, see 8 Ways to Avoid Probate, by Mary Randolph (Nolo).
