Why You Must Coordinate Your Assets

An estate plan is more than just your will. More and more wealth is controlled by beneficiary designation. A will does not override or control assets that contain a beneficiary designation. Such assets may include:

  • Real estate controlled by a Transfer on Death Designation Affidavit
  • IRAs
  • 401ks
  • Life insurance
  • 529 plans
  • Brokerage accounts with beneficiary designation
  • Bank accounts with beneficiary designation

How does this apply in the "real world"? If a person takes out a life insurance policy and names only their oldest child as their beneficiary, but then drafts a will that states that multiple children are to take equally, those other children will not receive any of the life insurance proceeds. A will only controls the items that are in the client's name upon death. All assets with a beneficiary designation transfer to the beneficiary upon death and are not part of the probate estate and are not controlled by the will. 

A well-drafted will or trust is an integral part of any estate plan. Assets with beneficiary designations serve an important role as well and are entirely appropriate. However, it is crucial that assets with beneficiary designations are coordinated with the rest of the estate plan to ensure the objectives and wishes are met. 

Please contact me to set up a free initial consultation to discuss your estate planning needs.