There are many different steps that go into the estate planning process. Cataloging your assets and reviewing the tax implications of your plan are important, but they are only part of the process. One of the essential steps in estate planning involves identifying your beneficiaries.
Your beneficiaries are the individuals that are entitled to inherit your estate when you pass away. While beneficiaries are often spouses and children, you have the right to designate beneficiaries as you see fit. You could benefit from the guidance of a seasoned attorney when considering beneficiary designations in Junction City estate planning.
Who are Beneficiaries?
Before a person can designate their beneficiaries in an estate plan, it is essential to understand what constitutes a beneficiary in the eyes of the law. A beneficiary is an individual that is set to receive the property held in the estate following the owner’s passing.
When it comes to Junction City estate planning, many people only consider the beneficiaries they designate under their wills or trusts. The reality is that an estate often includes assets that require a designated beneficiary as well. These assets are not always considered part of an estate, but it is still important to make a plan for them.
One of the assets that will require a beneficiary designation is a payable-on-death account. These are standard bank accounts in many ways, with one crucial difference. Upon the death of the account holder, it transfers immediately to the possession of the named beneficiary. Designating beneficiaries is also a part of the life insurance planning process.
Consequences of Not Designating a Beneficiary in Junction City
When a person fails to name beneficiaries in their estate plan, this can result in major headaches for their loved ones. When beneficiaries are not specified for all of an estate’s assets, unintended parties could end up inheriting from an estate.
The lack of a beneficiary could also foil the purpose of an estate plan entirely. Many estate plans are designed to avoid the probate process and allow for the immediate distribution of estate assets. If a beneficiary is left out, it could require the court to open the probate process for a specific asset despite the efforts of the estate creator.
When Beneficiary Information is Outdated
There is more to beneficiary selection than picking an individual to inherit an estate. Priorities and relationships can shift during the course of a lifetime. These changes make it critical to update beneficiary information on a steady basis.
It is a good idea to review beneficiary information each year to ensure no changes are necessary. In addition to regular review, it is also helpful to reconsider beneficiaries when major life events occur. These could include marriage, divorce, or the birth of a child. Reviewing beneficiary information with the help of a Junction City estate planning attorney and keeping beneficiary information updated can help an individual avoid any unexpected problems in the future.
Talk to a Junction City Attorney About Beneficiary Designations in Estate Planning
If you are beginning the process of beneficiary designations in Junction City estate planning, a skilled attorney is ready to help. Your attorney could help ensure that you carefully select your beneficiaries and keep their information updated over the years.
Allow an experienced attorney to assist you with beneficiary designations. Call our office today to learn more about how we could help.