Important Reviews


All of our readers know estate planning is important, and keeping up with changes in your family is essential to good planning.  That means you must leave a clear and easy path for your family to follow.  A clear message will protect your family and loved ones and reduce fights and bad feelings.


An up to date estate plan will also save time and money, because there won’t be fighting.  Fighting costs money in time and legal fees.  Estate plans should be reviewed every two years.  But a good review should include all your assets; including pensions and 401(k)s.

12 Step Estate Planning Checklist

Don’t Disinherit


The wrong 401(k) beneficiary,  or the beneficiary on a pension, IRA or life insurance will disinherit loved ones like your children.  The reason is that a pension, 401(k), IRA or life insurance is controlled  by a beneficiary designation form, not your will or trust.


To make things more complicated, each pension, 401(k), IRA or life insurance has a different beneficiary designation form.  That means you have to review the beneficiary designation form for each pension, 401(k), IRA or life insurance policy.



Beneficiary Designation Form


A beneficiary designation form is a document which says, “I want this asset to go to a particular person.”  Your will might give certain assets to your spouse, but if you still want to give a gift to your children, or other loved ones after you are gone, you will need to change the beneficiary designation to the name of the person(s) who can receive that assets.


You can find the 401(k) beneficiary designation form through your employer’s website. The beneficiary form for a pension, IRA and life insurance policy can be gotten from your financial advisor, employee benefits department of your employer, or on the web.

Special Laws on Pensions


You can name anybody you’d like as a beneficiary in your will, or trust. When it comes to pensions or 401(k) plans you can’t.  If you are married,  it’s your spouse who is entitled to the money when you die.  If you want to leave a pension or 401(k) to someone else, your spouse must first file a notarized statement waiving rights to it.


Even a Prenup won’t help if you want to keep your pension or 401(k) assets out of the communal pot.  You’ll have to convince your spouse to sign a waiver after you’ve tied the knot. A person can’t give up spousal rights to inherit a pension or 401(k) until they’re actually a spouse. A Prenup by itself won’t work here.

Who Do You Want to Be the Beneficiary?


It’s much easier with the beneficiary of an IRA or life insurance.  Here you pick the beneficiary.  The assets are yours to give away.  All you need to do in the case of IRA or life insurance accounts, is pick the person(s) you want to receive the account.  All you have to do is make certain that the right person(s) is named as the beneficiary on the beneficiary designation form. 


The most common problem we see with these accounts is when people forget to update their beneficiary forms.  Very often we see life insurance beneficiary forms listing a person who died many years before.  That tells us that this beneficiary designation form hasn’t been looked at in years. 


We also see lots of confusion after a significant life change such as a divorce or a birth. Do you really want to leave your assets to your ex? Ask yourself a simple question. Who do I want to be the beneficiary of this asset when I die?  You will be surprised how often you change your mind.

How It Fits in Your Estate Plan


Having a will is important, but a will is simply one part of your Will and estate plan.  We recommend you look at all of the entire estate plan once a year. Being aware of all the documents in your estate plan, and keeping those documents working together in harmony, will ensure that your family and your legacy is protected.


When was the last time you reviewed? Our office can help.