Doing advanced planning is necessary if you intend to protect your heirs, minimize consequences for them, and ensure that your estate passes outside of probate. But if you don’t have an experienced estate planning lawyer to guide you through and help you avoid common missteps and problems that most people experience while attempting to avoid probate, you could leave behind a mess for your family members.
Avoidance of probate is one of the leading reasons why people reach out to estate planning attorneys today and everything from how you choose to name beneficiaries to how updated your estate plan is can have an impact on going through probate. If most of your assets are in brokerage accounts and you have used beneficiary designation forms on these, you may be under the impression that this bypasses probate. This current plan, however, could have complications.
Having a will is important even though you have already done the necessary step of establishing beneficiary designation on your investment accounts. This is because most people have assets that do not pass directly by beneficiary designation, like household cars, goods, jewelry or refunds received at the time of death.
A beneficiary designation, such as a payable on death designation or in your IRA brokerage account or life insurance policy will supersede provisions in your will with respect to that specific account. However, other assets that you have may still require that you go through probate process. Naming beneficiaries could also undermine a plan your attorney prepared if you haven’t looped in your lawyer or used trusts established in your will.
As financial institutions are acquired by others, accounts are changed, or as institutions merge together, the beneficiary designations that you might have had in place previously could be accidently lost.
This is why it’s a good idea to keep an eye on these materials on a regular basis and ensure that you have always updated things after major changes in your life, such as a marriage or divorce for you, or the death of your primary beneficiary. Talk to your Pasadena estate lawyer to learn more.