The COVID-19 pandemic motivated many people contemplating their own mortality to take the important step of creating a will and other documents encompassed in a New York estate plan. This step helps ensure your wishes are known and followed; it also makes provisions for worst case scenarios.
If you already had a plan in place, you may think you’re in the clear. However, even though you’ve done the heavy lifting, it’s still important to continue checking your beneficiary designation forms periodically and take steps to keep your estate plan in line with your current situation and wishes.
What Are Beneficiary Designation Forms?
A Last Will and Testament may name beneficiaries for certain pieces of your estate upon your death, such as:
- Real estate
- Bank accounts
- Personal effects
However, it cannot designate your beneficiaries for a few other assets you may also possess. Instead, you must fill out separate forms, known as beneficiary designation forms, identifying who those assets pass to. For example, these designations are required for:
- Benefits from a life insurance policy
- Various retirement accounts
Because these designations override anything in the will contradicting them, it is critical this is done correctly and remains up to date.
Mistakes on Designation Forms
Estate planning professionals specialize in preparing and executing the documents you need to put your estate plan in place and keep it in line with your current situation and wishes. Though they prepare the documents you need to sign, you should always review every document and form – including beneficiary designation forms – yourself prior to signing to make sure they are correct and complete. The preparers are human, after all, so errors may inadvertently occur otherwise.
Updating Forms After Life Changes and Family Changes
Many individuals satisfied that their estate plan is complete fall into the trap where they can forget about those documents. This means that the documents are woefully out of touch with the current individuals in their lives and life changes such as:
Failing to update estate planning documents often ends with unintended consequences that go against what they truly wish to happen.
Not updating your beneficiary designation forms in a timely manner could mean your new granddaughter gets no benefits from your life insurance policy, as she wasn’t yet born when you designated beneficiaries. Assets could also end up in the hands of people you wouldn’t currently want as beneficiaries; your ex-spouse may enjoy inheriting your retirement account as the beneficiary you designated, but it’s doubtful you want them to have it after a bitter divorce.
Speak to a New York Estate Lawyer
People should feel accomplished after they create and execute a comprehensive estate plan– it’s critical to make sure your wishes are carried out. However, just because you did this work doesn’t mean you can rest on your laurels forever – things change, and documents such as beneficiary designation forms must change with them to keep them aligned with your wishes. The experienced New York estate planning attorneys at MOWK Law can review your estate plan and help you update it so that is reflects your wishes in your current situation. Contact us today to learn more!