Beneficiary designations in Coral Gables estate planning are an important part of the process, and most of the time, the designations need special attention to ensure that the assets, including bank accounts, life insurance, retirement accounts and annuities are being distributed correctly. A beneficiary designation allows you to indicate how your assets are distributed once you pass away. Utilizing beneficiary designations helps your family avoid the costly probate process and provides a direct way for you to transfer assets.
One of our knowledgeable estate planning lawyers could explain the importance of beneficiary designations and help ensure your assets end up in the right hands.
The most common types of beneficiary designations that Veliz & Associates, P.A. handles are:
Retirement accounts (such as 401k plans) are employer-sponsored plans. It is necessary to elect beneficiaries for these accounts to make sure that the assets are paid out directly to the beneficiary instead of going through the probate process. Individual Retirement Accounts (IRAs) also require beneficiary designations to avoid probate.
Life insurance policies help policyholders name family members to receive the death benefit upon the policyholder’s death. Payable on death accounts (POD) are special bank accounts which allow the beneficiaries to receive the account balance upon the account holder’s death.
Investment accounts can also have a transfer upon death designation. Transfer on death accounts (TOD) exist, so the securities are moved directly to the named beneficiary of that account.
A dedicated lawyer could provide a more in-depth explanation of each type of beneficiary designation and how it affects estate planning for an individual in Coral Gables.
It is vital to have the various beneficiary designations reviewed and updated by a seasoned Coral Gables attorney. A person should update the designations in their estate plan after any life-changing event—such as marriage, divorce, the birth of a child, or a death—to avoid ambiguities in the document and ensure consistency with the other estate planning documents (such as wills and trusts).
Several scenarios may arise with beneficiary designations. For example, there may be a disagreement between beneficiaries and accusations that the designation was made under undue influence or duress.
Unclear designations can also lead to legal disputes. Coral Gables lawyers are here to review your estate planning documents, so there are no ambiguous beneficiary designations. Common mistakes include naming a deceased person, providing incorrect documentation, or failing to update a designation after a major life event.
Our attorneys also provide a comprehensive overview of the different tax obligations for beneficiary designations. For example, IRA accounts have different tax rules from life insurance payouts.
It is also important to consider the age and capacity of the named beneficiaries. For example, minors are unable to legally manage their assets, so it is important to also have a named guardian or establish a trust to avoid guardianship until the minor is 18 years of age. Additionally, persons with special needs may need to have a special needs trust established.
It is important to update all estate planning documents regularly and ensure they are consistent with one another. If there is a discrepancy between a will and beneficiary designation, the assets will be distributed to the beneficiary specifically designated on the account. If, for example, a will indicates that a certain asset should go to one person, but the beneficiary designation directs the asset to another person, the beneficiary designation will prevail.
Beneficiary designations in Coral Gables estate planning are a way to directly distribute assets and avoid the costly and lengthy probate process. Please call Veliz & Associates, P.A. today to schedule a consultation and discuss what your estate plan should entail.
We evaluate your case and determine how we might be able to help.
We will meet with you to discuss your next options and lay out a plan.
Our team guides you throughout the process so you feel confident about your choices.
(305) 250-9917