Planning for the various estate transfer options available and protecting against potential pitfalls can be overwhelming for many people. One way to keep it simple is to focus on the easy steps you can take, such as having current beneficiary designations for your investment accounts and insurance policies. Our firm suggests people periodically review their beneficiaries and update them for changes in personal circumstances, such as new children or change in marital status.
This single review step is essential because the beneficiary designations listed with your investment custodian or insurance company override what you have in your will. The “who” you want to leave your assets to is the most important part of the beneficiary review process. But, it is also a good idea to consider how qualified accounts versus non-qualified accounts have different tax implications for different types of beneficiaries. In addition, some strategies require you to coordinate your beneficiary designations with your other legal documents. So, don’t neglect the interplay between them.
If you are unsure about the transfer of your assets, meet with a lawyer to review it and put proper strategies in place. In the meantime, I encourage all clients to contact me to verify your investment account beneficiary designations.