There are several things to consider when deciding who will get what when a person has passed on. While most people focus on the will as the end-all in estate planning, beneficiaries are just as important. Those who are working on an estate plan in Washington should not only consider their will but also who will be named on their life insurance, IRAs and pension plans.
It does not matter who is designated in the will to receive a monetary inheritance, the beneficiaries named on the life insurance policies will be the ones to collect. This money is tax-free. Insurance payments are not subject to probate like a will is, so the recipient won’t have to deal with that process in order to collect their benefits.
In most cases, a surviving spouse is named as the beneficiary on a life insurance policy. If the surviving spouse is not able to handle the process for some reason, a trust may be assigned to do so. Before a trust is set up, however, it is best to consult with an expert who can ensure that all considerations have been made.
The law usually assigns IRAs and pension plans to the surviving spouse of the deceased. In situations where a second marriage has occurred, a waiver can be signed to disregard that law. If a person is not married, they can choose whoever they want to be the recipient of their IRAs or pensions.
There is a lot more to consider when focusing on life insurance, IRAs and pensions in Washington estate planning. By consulting with an estate planning lawyer, a person can be confident that his or her wishes will be carried out upon his or her death. The best way people can protect their estate and their loved ones after their death is by planning ahead.
Source: wickedlocal.com, “What to know about estate planning“, Katharina Helmick, July 23, 2017
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