As I work with clients, one of my goals is to help my clients tend to the necessary details of their estate planning. One detail we address is the proper identification of the client’s legal and financial beneficiaries. I want you, the reader, to double check that all of your various beneficiary designations are accurate and up to date. This is especially important if you, or your family, have experienced a divorce or a death—both of which will affect your desired distribution of your assets.
Remember, you can have beneficiaries designated in each of the following areas: (1) Retirement accounts–IRA, TSA, 457, 403B, 401K, etc., (2) Life insurance policies, (3) Traditional investment accounts, (4) Bank and credit union accounts, (5) Last will and testament.
With rare exception, the beneficiaries you designate will be individuals, a trust or a charitable entity. One of the reasons you designate beneficiaries is to allow the passing of your assets to your beneficiaries, without them having to go through the probate process. Probate is generally costly in time, energy and money. Consequently, to avoid probate, you do not want to name your estate as one of your beneficiaries.
If you want or need to change a beneficiary on a particular account, you usually have to use the company’s special form. It is simple, just contact the, insurance company, investment company, bank or credit union, and ask for a change of beneficiary designation form. In some instances, you may need to go to the bank or credit union, in person, to make the changes.
One over-looked beneficiary designation is the distribution of personal property under your last will and testament. Make sure you use the “memorandum” or list that came with your will. When I review old wills for my clients (something I always do at no cost), most of the time, the client has not used this wonderful means of distributing personal assets to heirs, or other loved ones. Pull out your wills now and check to see if you have completed, or begun completing your memorandum.
Lastly, whenever you recognize a need to name a new beneficiary, you will often need the new beneficiary’s name, address, birth date and social security number.
If you have any questions, feel free to give me a phone call at 303-225-0328.