It’s no question that estate planning can seem daunting. Beyond your last will and testament, there are a bevy of other documents that may seem unnecessary, duplicative, or just plain overwhelming. You may think making beneficiary designations, or forms that allow you to transfer assets directly to individuals without dealing with your will and the probate process, simplifies the entire endeavor. Unfortunately, there are a number of pitfalls that can happen when individuals simply settle for beneficiary designations without utilizing other estate planning tools with an experienced attorney.
1.) Your Beneficiary May Pass Away
Although this may seem obvious, many people do not consider that their beneficiary may pass away. With multiple assets, you may forget to change your designation in the event of your beneficiary’s death, leaving your asset stranded. You may be incapacitated in some way, which could render you unable to update your designations. Without proper mechanisms in place, you would be left without an avenue for passing on your assets.
2.) Your Beneficiary May Not Follow Your Wishes
You may name a beneficiary with the idea that they equitably share the asset or account you’ve left to them with other individuals, such as among siblings or children. Unfortunately, this may not always be the case. Proper planning can ensure your wishes are carried out exactly as you specify, without leaving it up to chance.
3.) Your Life Situation May Change
A variety of life changes could occur that may throw beneficiary designations out of balance or out of alignment with your wishes. Children and grandchildren may be born, close friendships or family relationships could falter, and marriages may end. And significant changes to your financial situation may necessitate a change in the way your assets are bequeathed, which all should be discussed and planned for with an estate planning attorney.
4.) Your Beneficiary May Be Hard to Find
Even if none of the above difficult to imagine scenarios occur, the problem could be quite simple: your beneficiary may be difficult to track down. People move cities, states, and even internationally. Name changes due to marriage or other life events could make it difficult to find a beneficiary. And if you make a small spelling or other mistake in naming your beneficiary more problems locating the correct individual could arise.
5.) Your Beneficiary Decision May Conflict With Your Will
If you do take the time to make a will with an estate planning attorney, your wishes at the time of drafting could conflict with previous beneficiary designations you’ve made. This could cause needless strife and dispute during the probate process, complicating an already difficult and stressful matter.
Contact a Texas Estate Planning Attorney for Help Creating an Effective Estate Plan
Estate planning the right way may seem complicated, but with the right estate planning attorney, you’ll be able to rest easy knowing your family and assets will be protected. The Houston estate planning lawyers at McCulloch Miller, PLLC have extensive experience in estate planning and other family law and financial matters. Contact our office at 713-936-9073 to schedule an initial consultation with an attorney on our team.