Estate planning is the process through which you can make sure that your assets are distributed the way that you want them to be when you pass away. In the absence of a well-crafted and comprehensive estate plan, state law will determine what happens to your hard-earned assets and your estate could be tied up in expensive probate proceedings for a significant period of time.
One of the main goals of New Jersey estate planning is to have as few assets go through probate as possible. Anything that is passed through a will goes through probate, so many people use beneficiary designations on certain accounts of forms of joint ownership to avoid probate. Here are two common estate planning mistakes that can happen when trying to avoid having your assets go through probate.
POD Bank Accounts that Do Not Match Will Beneficiaries
When you open a bank account, you may have the option of designating a person to whom the account will transfer if you pass away. These accounts are generally known as Payable on Death or POD accounts. Years later, as the assets in the account grow and the circumstances of your life change, you may execute a will that designates another person as the beneficiary of that account. Unfortunately, these types of bank account designations generally override the terms of a will, which can result in your assets being distributed differently than you had intended.
Beneficiaries Designation that are at Odds with the Terms of Your Will
Insurance policies, retirement accounts, annuity, and similar assets generally pass to a named beneficiary. As a result, beneficiary designations are often an important part of your overall estate plan. Unfortunately, when people execute a will, they often forget to update the beneficiaries of these accounts often causing conflict among family members and other beneficiaries. For this reason, it is important to regularly review beneficiary designations and ensure that they still reflect your wishes.
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If you need to create an estate plan or simply have not reviewed your current estate plan in some time, you should speak with an estate planning attorney as soon as you can. At Borrus, Goldin, Foley, Vignuolo, Hyman & Stahl, PC, we are committed to helping individuals protect their assets for future generations. To schedule a case evaluation, call our office today.