Did you know that not naming a beneficiary to your will gives the state the right to decide who inherits your estate plan? Therefore, it is important to seek help from an estate planning attorney in Orange County to let you designate who receives your property on your death.
Having a complete estate plan is essential; yet, choosing your beneficiary designation is an oft-forgotten step. This should not be the case. Your life insurance, pension plans, annuities, IRAs, etc. should be properly distributed to the right people upon your death.
An Orange County estate planning attorney can help you dig into the complexities of choosing the right beneficiary designations and understand the important facts and elements of it.
Who can be your beneficiary?
Anyone you choose can be your beneficiary. After all, these are your assets and you have the right to choose who gets them when you die.
However, your beneficiary must be someone who is alive and they cannot be the witness when you sign your will document. Therefore, you should have someone else to act as your witness when you sign your will with a living trust attorney in Orange County.
If you’re married and with children, you may need to create a trust for you to pay out distributions to them, especially if they are under 18 years old. You may also do this for your pets.
Moreover, if you’re living in a community property state, also known as a marital property, where your spouse owns 50% of the properties you two acquired together during your marriage, you may need to have an agreement signed with your spouse if you choose to designate someone else as your beneficiary for your estate plan.
You can also choose to name more than one beneficiary, and those people won’t be restricted to your family, friends, or non-related individuals. You can name a business, a charity, or foundation as your beneficiary too.
You should keep in mind that including the money you have in your bank or pension account like an IRA may come in their own beneficiary designation. However, with the help of your trust attorney in Orange County, CA, you may fill out a beneficiary designation form and make a bank account, Social Security benefits, or pension benefits that are transferable on death to your chosen beneficiary.
Choosing the Right Beneficiary For Your Estate Plan
You are the only person to determine who gets your assets when you die. Often, people choose their spouse, children, a family member, or friends as their beneficiaries, leaving them behind an inheritance to keep their memories with them, and sometimes to help them live a comfortable life.
However, as mentioned above, you can also have an organization or business as your beneficiary. Additionally, you can also name your beneficiary both ways—name multiple beneficiaries to your estate plan, to an individual and an organization.
If you are to name multiple beneficiaries to your estate plan, you will have to indicate specifically how your assets should be divided. You can give specific assets like your house and car to your spouse, your boat to your child, and the residual estate to an organization.
You can also divide and distribute your estate plan by percentages like giving 50% of your assets to your other half, 20% to your daughter, another 20% to your son, and 10% to an organization. If you wish to do any of these two, an Orange County estate planning lawyer can help you make this happen.
In some cases, if your spouse isn’t alive to receive your house and car, you can assign a secondary beneficiary for those assets like your grandchild or your sibling. Allocating your assets to the right people can get a complex, so you may want to seek an Orange County trust attorney‘s help to come up with a solid will that ensures your beneficiaries receive what you intended.
You wouldn’t want your chosen beneficiaries to fight over who gets what and even contest them in court on your death. This is the main reason why it is important to choose the right beneficiary designations for your estate plan.
Reviewing Your Beneficiary Designations
It is wise to review your beneficiary designations every few years, especially at a time when the account holder goes through a life-changing experience like a divorce, marriage, death of a loved one, or changes in their financial status. This can be done with the help of an estate planning attorney in Orange County, CA.
To avoid mistakes and facing beneficiary designations issues that may arise, a trust attorney is the right person to help you. For example, this may be helpful you would like to designate a loved one with special needs who may not receive your assets outright on your death.
Further, there are adverse consequences of not keeping your beneficiary designations updated. Your beneficiary designation overrides the distribution indicated on your will. Therefore, if you are updating your estate planning documents, you should also update your beneficiary designations on your assets because the distribution upon your death may not exactly match your intent.
There is plenty of work to be done regarding changes to your beneficiary designations. To make sure you don’t miss a trick, a trust attorney in Orange County can discuss this matter to you.
Are you thinking or planning about who gets what when you pass on? If you need assistance in planning your beneficiary designation or other related concerns, speak to the legal team at Thomas McKenzie Law today.