Long Island Estate Planning: Designate a Beneficiary
Many people overlook one of the simplest ways to ensure that their assets are transferred as they wish. Designating beneficiaries on your asset accounts is one of the easiest ways to do this and requires minimal effort. By designating a beneficiary for assets such as bank accounts, insurance policies, and retirement accounts you can ensure that the intended party receives the transfer as soon as possible, avoiding probate. Even though a beneficiary designation does not offer some of the benefits that other methods do, it is advantageous because of its simplicity. There is also flexibility in choosing this method as you can designate multiple beneficiaries and even determine the proportion that will go to each. You can also appoint a contingent beneficiary who can receive the asset if your primary beneficiary is unable to. A default beneficiary can also be designated, which is the third in line and is usually a legal entity, trust, or charity.
An article on WealthManagement.com highlights the advantages of designating beneficiaries, but also points out that the designation should be as clear as possible in order to avoid any confusion when the transfer is being made and you are no longer there to clarify. They also advise that beneficiary designations should be periodically reviewed and revised as needed. If there is a divorce, falling out, long term care need or death a change may be required. Luckily, it is easy to make this change. However, WealthManagment.com reminds us that “with this ease can come complacency, which can lead to easily avoidable errors.” One way to avoid any errors is by planning with knowledgeable professionals who can ensure that each part of the process is done diligently and is continually up-to-date.
Tully Law, P.C. is a Long Island estate planning firm available to assist you with all aspects of the planning process. Please do not hesitate to contact us to schedule a consultation today.