When setting up your estate plan, changes are guaranteed to happen. But failing to keep track of those changes can affect your loved ones in unexpected ways. Let’s say that you recently went through a divorce. You may have removed your ex-spouse from your will. But what if they are still on your retirement plan or life insurance? Maybe you listed one of your children as a beneficiary to one of your assets. But you didn’t list their name as a beneficiary to another asset. These are examples of uncoordinated beneficiaries that can be resolved by a South Florida Estate Planning Attorney.
What Are Uncoordinated Beneficiaries?
Uncoordinated beneficiaries are a mistake that many people make with estate planning. It happens when a person does not have the same beneficiary named on all their asset forms and documents. You experience many changes throughout your life. You may get married, divorced or bring new children into your family. Unfortunately, many people forget to update their estate plans and beneficiary designations when these major life changes happen. They may forget to review each asset and ensure the correct beneficiary is listed.
What Assets Are Listed in a Will?
The following assets are included in a will:
- Bank accounts
- Real estate property
- Digital assets(online storage accounts, blogs, websites, email accounts, etc.)
- Collectible items
With each asset, you will be responsible for naming a beneficiary.
What Assets Are Not Included In A Will?
The assets not included in your will are your 401(k) account, life insurance policias and IRAa. These assets are not included because you had already listed beneficiaries when establishing these accounts. Many people do not know this, especially people who create their wills.
This is often how uncoordinated beneficiaries happen.
If you listed someone as a beneficiary on your life insurance, but your will states to give your life insurance to someone else, that is an uncoordinated beneficiary – and that presents a problem.
Problems With Uncoordinated Beneficiaries
When there are inconsistencies with your beneficiaries, it can create problems for your loved ones. Once you die, that’s it. You can’t undo what has been stated in your will. Your loved ones will waste additional time and money trying to decipher your assets’ true beneficiaries. Your family may have to take the issue to the probate court, where the judge will execute your wishes as listed in your will. This can lead to more tension within your family. Your assets may end up in the wrong person’s hands.
How to Solve Uncoordinated Beneficiaries
Working with a South Florida Estate Planning Attorney is the best way to solve uncoordinated beneficiaries. You want to make sure that each one of your beneficiaries is updated. A South Florida Estate Planning Attorney can help you review your entire estate plan. It’s easy to overlook important assets and beneficiaries in your estate plan when working alone without guidance.
Make Regular Updates to Your Estate Plan
Working with an Estate Planning Attorney can make it more convenient for you to update your plan, and provide Peace Of Mind. One of the most common mistakes people make with their estate plans is failing to update them. Just like any other policy, it is not a one-and-done action. It is a plan that must be revisited often. You should review and revise your estate plan whenever there are major changes to your personal circumstances – birth, death, marriage, divorce, or financial changes such as the purchase or sale of a business or asset.
A South Florida Estate Planning Attorney can ensure your estate plan is as current as possible. You want to ensure that your life’s changes are reflected and supported by your estate plan. A practical rule is to revisit your estate plan following every major life event, or every 3-5 years.
What Should I Look For In An Elder Law Attorney?
You want the best Elder Law Attorney to represent your elder. Elder Law is an area of law that can seem complicated at times. It takes a certain attorney to manage the special legal needs of elders.
It’s important to hire a Florida Elder Law Attorney who knows Florida Estate Planning laws and understands the unique circumstances of many Florida senior citizens. When searching for an Elder Law Attorney, you want someone who has been practicing elder law for a while. An Elder Law Attorney specializing in elder law for over a decade is better than a general personal injury lawyer.
You also want someone who can look for personalized solutions to your elder’s issues. Your elder law attorney should be passionate about finding solutions that cater to your elder’s needs.
A well-rounded attorney is also a good choice. Your elder may deal with various financial, health and legal matters. You want an Elder Law Attorney who can handle all these matters for your loved one.
Naming Contingent Beneficiaries
Another possible solution is naming contingent beneficiaries. When naming beneficiaries to your assets, there are two types that you can list: primary and contingent.
- Contingent beneficiaries are backup beneficiaries.
- While the primary beneficiary is the first to receive your asset, the contingent beneficiary is next.
There are occasions when the primary beneficiary may be unable to accept the asset. Your primary beneficiary may have passed before you or cannot be found. These are cases where naming a contingent beneficiary is necessary. Whoever is listed as the contingent beneficiary will become the primary beneficiary.
Do You Need to List a Contingent Beneficiary?
Absolutely. If something unexpected happens to your primary beneficiary, you must list a contingent beneficiary. Let’s say your primary beneficiary passes away, and no one is listed as a contingent beneficiary. Your assets will then return to the estate and be divided in probate court. This could again cost your loved ones additional time and money. Listing a contingent beneficiary can prevent your loved ones from experiencing these issues.
The Biggest Mistake When Naming a Contingent Beneficiary
Naming the same person as a primary and contingent beneficiary is the biggest mistake that you can make. You’ll find yourself in the same position when something happens to that person. You can even avoid making this mistake by listing multiple contingent beneficiaries on your assets. Even better, there’s no limit to how many contingent beneficiaries you can have. If you want to list 10 for one asset, you can do so.
Working With An Estate Planning Attorney
Working with a South Florida Estate Planning Attorney can also help you protect your will.
Just like you, your loved ones will go through many life changes. They may experience marriage, divorce and parenthood. Your attorney can ensure your assets are protected long after you’re gone. They can ensure that your loved ones’ inheritance is protected in case of divorce or a lawsuit.
Call THE South Florida Elder Law Attorney – Barry Siegel
Call The Siegel Law Group at 561-576-6206 to schedule a complimentary consultation, or submit our online contact form to schedule a consultation today. If you have any questions, do not hesitate to contact us.