Detailed Answer: How wills and beneficiary designations affect probate in New Mexico

Short answer: In New Mexico, a last will controls only assets that must pass through probate. Many common assets can bypass probate if they have valid beneficiary designations, joint‑owner rights (with survivorship), or payable/transfer‑on‑death designations. To reliably avoid probate for everything you care about you will often need a combination of beneficiary designations, titled joint ownership or POD/TOD arrangements, and in some cases a revocable living trust. This is not legal advice—see the disclaimer at the end.

How probate vs non‑probate transfers work in New Mexico

Think of your property as two piles:

Pile A: Assets that pass by operation of law or by contract (non‑probate). These include accounts with a named beneficiary, assets owned in joint tenancy with right of survivorship, and assets with payable‑on‑death (POD) or transfer‑on‑death (TOD) designations.
Pile B: Assets that only pass under a will or by intestacy and therefore usually require probate administration. These are assets owned solely in your name without beneficiary designations or survivorship rights.

Only the assets in Pile B generally go through probate and are distributed under the will or under New Mexico’s intestacy rules if you die without a will. The New Mexico Probate Code governs probate administration; for an overview see the New Mexico legislature and courts resources (NMSA 1978, Probate Code) at the New Mexico Legislature site: https://www.nmlegis.gov/ and the New Mexico Courts probate self‑help pages: https://www.nmcourts.gov/self-help/probate/.

Common non‑probate tools used in New Mexico

Beneficiary designations (retirement plans, IRAs, life insurance): Designating a primary and contingent beneficiary on your account or policy means the asset passes directly to that beneficiary upon your death, generally outside probate. Federal ERISA/common plan rules govern many retirement accounts; confirm forms with the account custodian.
Payable‑on‑death (POD) / Transfer‑on‑death (TOD) bank accounts and securities: You can name one or more beneficiaries to receive bank account funds or brokerage assets at death. Those assets transfer to the beneficiary when you die and normally avoid probate.
Joint ownership with right of survivorship: If you and your spouse (or another person) hold property as joint tenants with right of survivorship, the surviving owner automatically owns the asset at death. Use caution with real property—joint titling has tax, creditor, and control implications.
Transfer‑on‑death deeds / beneficiary deeds for real estate: Some states allow a beneficiary deed (sometimes called a transfer‑on‑death deed) that names who gets real property at your death without probate. Whether and how you can use such a deed in New Mexico can depend on statute and recording requirements. Confirm current New Mexico rules and form requirements with the county recorder and an attorney.
Revocable living trust: A trust can hold title to most assets during your lifetime. On death, the successor trustee distributes trust assets under the trust’s terms—usually without probate. Trusts require retitling assets into the trust during life to be effective at avoiding probate.

Practical examples

Example 1 — Bank accounts: If a husband names his wife as POD beneficiary on his checking account, that account passes to the wife directly at his death and usually avoids probate. If he forgets to name a POD beneficiary, that account may become part of his probate estate and be distributed under his will or intestacy rules.

Example 2 — Retirement accounts: A wife names her children as contingent beneficiaries of her IRA and her spouse as primary. After her death the IRA custodian pays the account to the surviving spouse (or to the children if the spouse predeceased her) outside probate, subject to tax and plan rules.

Example 3 — Home ownership: A couple who owns their house as joint tenants with right of survivorship will have the house pass to the survivor on the first death without probate. If instead the house is titled only in one partner’s name with no beneficiary deed, it likely requires probate to pass to heirs.

Key limitations and risks

Wills do not control non‑probate assets. A will cannot override a valid beneficiary designation, POD account, or joint‑tenancy right.
Beneficiary designations must be correctly completed and kept current. Divorce, remarriage, or failure to name contingents can produce unintended results.
Joint ownership exposes assets to the co‑owner’s creditors and may carry gift or tax consequences.
Transfer‑on‑death arrangements for real property must meet state recording rules to be effective. Mistakes can cause title or probate problems.
Small estate procedures may allow heirs to collect some assets without full probate, but rules and value limits vary. See New Mexico Courts for small‑estate guidance: https://www.nmcourts.gov/self-help/probate/.

Steps to set this up correctly in New Mexico

Inventory all assets and note current title, account owner, and any named beneficiaries.
Make beneficiary designations on retirement accounts, life insurance, annuities, and any custodial accounts. Add contingent beneficiaries.
Convert eligible bank and brokerage accounts to POD/TOD where appropriate.
Decide whether joint titling makes sense—consult an attorney or financial advisor about creditor, tax and control tradeoffs.
For real estate, determine whether a beneficiary deed (TOD deed) is available and appropriate in New Mexico; confirm the required statutory language and county recording steps.
If you want comprehensive probate avoidance, consider a revocable living trust and retitle assets to the trust. Make sure you update deeds, titles and beneficiary forms to match your overall plan.
Review the plan after major life events (marriage, divorce, birth, death, large changes in assets).

When to see an attorney

Speak with a New Mexico estate planning attorney if you have any of the following:

Real estate you want to leave outside probate and you’re unsure about TOD/beneficiary deed availability or effects.
Complex estate tax or creditor concerns, blended family issues, or private business interests.
Large retirement accounts where distribution timing and tax planning matter.
Unclear or conflicting beneficiary designations or title problems.

Helpful Hints

Check beneficiary forms annually and after life events. A named beneficiary typically controls the disposition of that asset regardless of what your will says.
Name contingent (secondary) beneficiaries in case the primary beneficiary is no longer alive.
Keep a short, up‑to‑date inventory (accounts, titles, beneficiaries) and share it with your trusted executor or successor trustee and attorney.
If you use a trust, retitle real estate and accounts into the trust’s name—otherwise the trust won’t avoid probate for that asset.
Don’t rely solely on joint titling for probate avoidance without understanding creditor and gift issues; joint ownership gives the co‑owner immediate control in many circumstances.
When in doubt, get a local attorney to review your documents and the recorded title on real property. County recording errors can undo a TOD plan.

Resources

New Mexico Courts – probate/self‑help resources: https://www.nmcourts.gov/self-help/probate/
New Mexico Legislature (for New Mexico statutes, including the Probate Code): https://www.nmlegis.gov/
U.S. Department of Labor (information about retirement plan rules and beneficiary issues): https://www.dol.gov/agencies/ebsa

Final takeaway: Yes—you can use beneficiary designations, POD/TOD accounts, joint ownership, and (when properly drafted and funded) trusts to keep many assets out of probate in New Mexico. However, a will still matters for assets that have no beneficiary or survivorship arrangement and for naming guardians for minor children. To make sure your documents work together and avoid pitfalls, have a New Mexico attorney or qualified estate planner review your situation.

Disclaimer: This article explains general principles of New Mexico law and is intended for educational purposes only. It is not legal advice and does not create an attorney‑client relationship. For advice tailored to your situation, consult a licensed New Mexico attorney.