Beneficiary mistakes that you’ll want to avoid

| Mar 24, 2021 | Estate Planning And Probate |

In many cases, financial assets pass to beneficiaries per the terms of a beneficiary designation. It may also be possible to transfer a Wisconsin home, car or other tangible assets by using such a document. As a general rule, it is a good idea to review your beneficiary designations regularly as they trump the language contained in a will.

You don’t want to accidentally transfer an asset to an estranged relative

Over time, you may divorce a spouse, lose contact with your adult child or drift apart from a sibling. However, those individuals could still inherit from your estate if any of their names appear on a beneficiary designation form. Ideally, you’ll review these forms after major life events such as a divorce, marriage or death in the family. At a minimum, you should review your estate plan once a year to ensure that everything is in order.

Don’t forget to name alternate beneficiaries

If a primary beneficiary passes away, an asset may revert back to your estate. In such a scenario, that asset would likely be subject to probate, which means that state law would likely determine who receives that item. It may be possible to avoid this by naming a contingent beneficiary who would automatically inherit whatever the primary beneficiary was supposed to receive.

An attorney may be able to help you fill out, review or revise a beneficiary designation form. Taking these steps may help to ensure that your assets to individuals who you feel will make the best use of them. If necessary, legal counsel may be able to review other parts of your estate plan to determine if are necessary to meet your long-term needs.