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3 Ways to Avoid Wrecking Your Estate Plan with Beneficiary Designations

3 Ways to Avoid Wrecking Your Estate Plan with Beneficiary Designations

By Solid Serenity Legal Solutions

One of the best ways to pass assets to your loved ones without them having to go through the probate process is to name beneficiaries on your assets. Stocks, bonds, mutual funds, and bank accounts allow you to name a person or persons to inherit your assets without the need to go to court. In some states, you can even name a beneficiary for real estate.

But, if you don’t name your beneficiaries properly on these assets, it can derail your entire estate plan. Here are 3 ways to avoid wrecking your estate plan with beneficiary designations.

(1) Name a Beneficiary

It seems simple enough, right? If you want a beneficiary for your asset, name one. However, many companies have their own designation forms, requiring you to reach out to each holding company individually, fill out their forms, and follow their specific rules to name your beneficiaries.

I know, it gets tedious. But, if you don’t have a beneficiary named, that asset will go to your estate.

What does that mean? That means your family will have to go through the costs, time, and stress of probate court to access and transfer the asset after your death.

Trust me, they’ll appreciate you later for the work you put in now!

(2) Review Beneficiaries

A problem many probate attorneys see in their practice, is when a beneficiary was named by the owner of the asset, but that beneficiary has died. When big events happen in your life- marriage, divorce, birth, death- double-check your beneficiary forms to ensure you have the people you want to receive the asset properly named.

If you don’t, and the person you originally named but no longer want to be beneficiary is still living, that person will get your asset. If they are not still living, your asset will pass to your estate. As we discussed earlier, assets that are left to your estate require your loved ones to go to court to pay for probate.

(3) Follow Proper Procedure to File Your Beneficiary Forms

Again, this seems simple enough, right? You fill out the form, you send it in. But, it’s not always that easy. Some companies may allow you to email the form, others may not. Some will let you do everything online. Others will make you come in in-person.

When you turn in your beneficiary forms, make sure the company got them updated before scratching it off your to-do list. It will save you and your family a lot of money, headache, heartache, and time in the long run. Your family will appreciate your hard work in their hard times.

To plan your estate, reach out to one of our experienced attorneys.

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