Your Estate Plan Is More Than Just A Will

How your accounts are titled will determine whether they will be transferred through the costly and time consuming process of probate upon your death. Probate is the process of authenticating the Last Will and Testament, paying the final bills and taxes, and distributing the remainder of the estate to the listed beneficiaries.

 

Proper account titling allows you to transfer assets directly to your heirs outside of your Will as titling always takes precedence over a Will. Beneficiary designations on retirement accounts and life insurance policies also bypass your Will.  By naming beneficiaries on your accounts, assets will be passed directly to your heirs. Changing title without consulting your attorney or advisor may cause unintended consequences.

 

Here are some common methods of titling assets:

 

  • Individual Accounts – One person or entity owns the account. By leaving an account titled individual, assets pass according to your Will and would be subject to probate.

 

  • Transfer on Death/Payable on Death (TOD/POD) – This designation can be added to an individually titled account, listing a specific beneficiary for assets to be automatically transferred to upon your demise.

 

  • Joint Tenants with Right of Survivorship – JTWROS is one of the most common ways married individuals can pass assets to their spouse. This account will be passed directly to the surviving account holder upon the death of the original account holder.

 

  • Titling in Revocable Trust – In the event that you have a revocable trust drafted by your estate attorney, you will need to transfer assets to your trust. By retitling property and accounts in trust, you are essentially transferring ownership to the trust, while maintaining control of your assets. At the time of your death, your assets will be distributed based on the terms of your trust document. Unlike a TOD account, you have appointed a trustee to manage assets upon your death or disability.

 

We suggest periodically reviewing your account titling and beneficiaries with your attorney or advisor to confirm your wishes will be met. Proper estate planning will save your loved ones time, hassle and costs upon your passing.

OWM provides financial planning, investment management, and retirement coaching to affluent individuals, business owners, and families.