Have You Looked at Your Beneficiary Designations Lately?
Many times, people make a will or create an estate plan, toss it in a drawer, and never think about it again. They do the same thing with the beneficiary designations on their retirement plans and life insurance policies. You start a new job, fill out a bunch of forms, and never revisit those critically important issues – like the people you picked to inherit your 401(k), company stock, and life insurance benefits.
One of the big guarantees in life is that life is constantly changing. If you don’t regularly review and update your beneficiary designations, you could leave financial hardship behind for your loved ones when you pass away.
Blended Families, Adult Children, and Beneficiary Designations
Today, many people have so-called “blended families” where husband and wife are divorced and remarried with children from previous relationships. It makes sense that each spouse would want to provide for his or her blood offspring more so than stepchildren. Because state intestacy laws pass an individual’s probate assets to blood relatives, many people turn to non-probate assets to provide for stepchildren and other non-blood relatives. Non-probate assets include property grounded in contract principles and encompass things like life insurance and retirement accounts. Simply put, if you designate a named beneficiary for it in a contract or form, it’s a non-probate asset.
But what happens in cases where an elderly parent’s long-term care needs drain the probate estate completely? It’s not uncommon for one or both spouses to require costly nursing home care or lengthy hospitalization. Even a year of residential care can cost tens of thousands of dollars. In a case where biological children were named in a decedent’s will but left out of non-probate assets, an individual’s children would end up with no inheritance. This could create a potential windfall for stepkids designated as beneficiaries on life insurance policies and retirement accounts.
Review Your Estate Plan
At Gregory H. Zogran, P.A., I help families and individuals plan for tomorrow and beyond. Don’t leave your loved ones’ future to chance – and don’t assume that the estate plan you made years ago is still relevant today. Get the peace of mind you deserve. Call me today at 772-220-9699 to discuss your needs.
This website has been prepared by Gregory H. Zogran, P.A. for informational purposes only and does not, and is not intended to, constitute legal advice. The information is not provided in the course of an attorney-client relationship and is not intended to substitute for legal advice from an attorney licensed in your jurisdiction.