Coordinating Your Estate Plan

Beneficiary Designations are a powerful away to efficiently pass assets to your beneficiaries in things such as 401k's, retirement accounts, etc.  It allows assets to pass directly to the beneficiary without having to pass through the potentially costly, burdensome and, more often not, time consuming probate process.

However, this benefit is not without some potential cost.  These beneficiary designations override any instructions in your will.  Unless properly organized, they can lead to some unforeseen and undesired results.

For example, if an individual in a second marriage has his or her first spouse named as the beneficiary of a financial account, and fails to make a beneficiary desigation change after re-marrying, the benefits form that account may pass to the deceased ex-spouse.  A result most would qualify as disastrous.

The Wall Street Journal recently put out an article on this subject and the dollar amounts at risk for potential beneficiary errors is staggering:

Read the full text of the article HERE.

Time to Get Organized

An article in July 2nd's Wall Street Journal (Designing Your Death Dossier - WSJ.com) was a good reminder on the importance of getting your personal financial, insurance and legal materials organized and centralized.

According to the article, state treasurers currently hold $32.9 billion in unclaimed bank account funds, presumable from account holders who have passed away without leaving a clear record of the accounts with their heirs.

Its crucial to keep records of current accounts, insurance, your will, power of attorneys, and living wills, along with proof of ownership in assets such as land or home and list of liabilities (house/car payments, etc) accessible by your heirs. This ensures that they will not have to enter into the a lengthy, often costly, procedure of seeking permission from the court to gain access to this information.