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Having a will and a revocable trust is not enough

Massachusetts residents who engage in estate planning often feel that their job is done once they sign on the dotted line. However, having a will and/or a revocable trust is not enough to ensure that the assets will end up with the proper heir or beneficiary. The property needs to be properly titled and beneficiary designations on other accounts need to be in line with the rest of the estate plan.

Retirement accounts, such as 401(k)s and IRAs, require that a beneficiary be designated when they are opened. Regardless of what a will or trust might say, those accounts will be distributed to the person designated. Other accounts, such as bank accounts, could have payable on death (POD) or transfer on death (TOD) designations. Therefore, they need to be reviewed periodically or whenever a change is made to the remainder of the estate plan to ensure that the funds are still going to the intended person.

Joint assets will also pass to the other party listed upon death without going through probate. As some people age, they add adult children to their accounts in order to ensure that bills continue to be paid if they become unable to do so. However, those people might not consider the fact that the whole account will pass to the joint owner, which could be contrary to the will or trust.

In order to ensure that the provisions of a will and revocable trust distribute a Massachusetts resident's property as he or she intends, it is imperative that every title document and beneficiary designation is reviewed. Otherwise, all of the hard work that was put into creating an estate plan could be inadvertently sabotaged. Therefore, ignoring this essential step could be disastrous.

Source: dailylocal.com, "Colliton: Retitling assets can change the estate plan", Janet M. Colliton, May 16, 2016

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