Is Your Estate Plan What You Think It Is?
You finally got your Will done. So, your estate plan is complete, right? Well… maybe not.
Donna was a widow for many years before she died. She had updated all of her legal documents just a couple of years beforehand. Her goal was to make sure everything went equally to her three kids and to make it as easy as possible for them to finalize her estate. What actually happened was a very different story.
Donna’s son Ben had passed away suddenly six months before she did. As a result, his two children received only 1/3 of what Donna intended to be her son’s inheritance. Donna’s niece Allison also got a piece of the pie – she received 10% of the entire estate. Sarah, Donna’s daughter, ended up with about half of everything while her other son, Patrick, received a little less than thirty percent of the estate.
| Wishes | Actual | |
| Ben (His Children) | 33.34% | 11% |
| Sarah | 33.33% | 50% |
| Patrick | 33.33% | 29% |
| Allison | 0% | 10% |
She just updated her Will! How does this happen?
We forget that a Will simply operates like a vacuum cleaner – it’s there to pick up all the pieces, even the bits and pieces you didn’t specifically direct in another way.
If you name a beneficiary and that beneficiary is living, it doesn’t matter what the Will says. If you title your bank account with another owner, that ownership might come into play no matter what your Will says. If you name a person to be paid at death or receive a transfer at death, it doesn’t matter what your Will says.
The titling of your assets and the beneficiary designations you make on your assets take precedence over your Will. If they don’t match your wishes, it doesn’t matter.
Worse, many beneficiary designations won’t accomplish what you wanted. They may be outdated, unable to be fulfilled, or simply wrong.
The saying that you don’t know what you don’t know applies here. The things that you don’t know that you don’t know will end up being the very things that hurt you or, in this case, your family.
Donna never intended for her grandkids not to have Ben’s share or for Allison to end up with half of everything. Unfortunately, she stopped her estate planning when she signed her Will.
Don’t forget to tie up loose ends and make sure the titling of your assets and beneficiary designations match your wishes! For the month of March, we’re offering a complimentary review of your titling and designations. Contact us today!