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    Identify role, responsibility of persons in estate planning

    Why it’s important to ensure those named in designations are consistent with overall strategy

     

     

    Asset titling, beneficiary designations

    Let’s take a closer look at account titling and beneficiary designations. You can liken these topics to off-ramps on an interstate highway.

    Depending on how assets are titled or beneficiaries designated, assets can go different directions at your death.

    For example, assets titled in your name alone are governed by your will and go through probate. Assets in a trust or held in joint tenancy will bypass probate. Neither direction is right or wrong, but one or another may be more suitable for you. Discuss these possibilities with your attorney.

    Let’s take a closer look at how titling matters, starting with assets in one’s individual name. The executor will control these assets, and he or she will follow the directions in the will. The assets will be distributed at the conclusion of the probate process.

    Assets in a revocable trust are controlled by the trustee or successor trustee. The trust document provides instructions, and they will be distributed or managed according to the terms in the trust.

    A beneficiary designation acts differently. This is a contract between an individual and the financial institution, and the terms trump everything else—even what the will or trust instructs. The beneficiary will file a claim, and the financial institution will distribute the asset. No probate. No governance by a will or trust instructions.

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