Ways You Could be Undermining Your Will

A will is one of the most basic yet important estate planning documents and something that everyone should have in place. It details your estate and your wishes in the event of your death. However, without proper planning and a professional look at your entire estate assets, there are actions you may be taking in other financial matters which could end up undermining your will and your plans.

Pay Attention To Beneficiary Designations On Non-Probate Assets

Your will contains a complete inventory of all property and assets you possess. It also dictates how you want these items to be distributed to your beneficiaries in the event of your death. When you pass away, your personal representative will file your will with the New York Probate Court. Once it goes through probate court proceedings and all estate debts and taxes are paid, distributions can be made to the people or organizations you specified. (Dying without a will is referred to as ‘dying intestate’. Probate court proceedings take longer, there is a greater potential for disputes, and distributions are made according to state law, rather than according to your specific wishes.)

Even with a will, there are certain assets you possess that are not required to go through probate court proceedings. These include:

• Money in financial accounts, such as checking account balances, money markets, and other savings;
• Certain pension funds and retirement accounts, such as IRAs and 401(k)s;
• Proceeds from life insurance policies you have in place;
• Certain types of property, depending on whether it is titled with Joint Rights of Survivorship (JTRS);
• Assets in trust funds you have created.

In establishing the above financial assets, there were beneficiaries you likely designated at the time you opened up the account. (You would have designated property rights either at the time of purchase or in later updates.) As these assets do not go through probate, your beneficiary designations on them could end up undermining the terms set forth in your will.

Updating Your Beneficiaries

The Balance warns that as beneficiary designations are legally binding documents, they trump any other arrangements or designations made in your will. This is why it is important to periodically review these. Problems that can arise include:

• Failing to acknowledge people who are no longer in your life either due to divorce or death;
• Failing to include people new to your family, such as due to marriages, births, and adoptions;
• Failing to account for changes in financial situations, such as modifying amounts distributed among children based on their individual needs;
• Failing to account for changes in age or health, such as making special provisions for older adults or others who may have suffered recent disabilities.

Contact Us Today for Help 

At Cavallo & Cavallo, we provide the professional estate planning help needed to ensure both you and your loved ones are protected. Call or contact our Bronx & Westchester estate planning attorneys online to schedule a consultation today.

Resources:

nycourts.gov/courthelp/WhenSomeoneDies/index.shtml

thebalance.com/why-beneficiary-designations-override-your-will-2388824

https://www.cavallolawyers.com/financial-exploitation-a-common-problem-among-older-adults/