If you have a diversified portfolio of assets, you may have questions about the best way to leave securities to your heirs would be. For example, can you pass securities on to heirs through transfer on death (TOD)? We’ll examine how this works so you can make an informed decision on the best way to leave your assets to beneficiaries.
You Can Pass Securities Directly to Heirs at Death
The good news is that the state of California has ways to transfer some of your assets outside of the potentially costly and lengthy probate process. One of these is the California Uniform TOD Security Registration Act. This act specifically addresses the passing of stocks and other securities directly to a beneficiary by what is called transfer on death.
The good thing about TOD is that if something happens to you, your heir immediately becomes the owner of the securities that have been designated. The key is to properly designate the TOD assets so that the transfer takes place seamlessly and without question.
Help in Designating Transfer on Death Securities
Petrov Law Firm specializes in estate planning. We can help you to leave your assets to beneficiaries in a way that cuts through some of the legal red tape and gets the money to your heirs faster and without costly legal bills. To learn more, give our San Diego office a call today at 619-3344-0360. We can help you with all of your estate planning needs in the state of California.Read More
When a person passes away, his or her retirement accounts do not go through probate. Instead, retirement accounts are automatically paid out to a beneficiary who is selected by the account holder. What are the different types of retirement accounts that a person may have? Why should you periodically check to see who your beneficiaries are?
Which Retirement Accounts Have Beneficiaries?
If you have a savings account, this can be left in trust. Or you may have another person’s name on the account. However, retirement accounts like IRAs and 401(k)s are different. These should have a beneficiary listed on the policy. If you live in California and have an IRA or a Roth IRA, your spouse will be the beneficiary. The only way to designate someone else is to have your spouse provide written consent allowing you to designate another beneficiary. The same is true with a 401(k). Thus, unless your current mate has signed a waiver and you have designated someone else, he or she is the beneficiary.
Why Maintain Your Beneficiary List?
You should check on your beneficiaries periodically, especially if you experience a change in life circumstances. For example, if you get divorced, you will likely want to change the beneficiary on your retirement accounts.
Of course, your retirement accounts may not be the only thing that needs changing. You may have to update the beneficiary on a life insurance policy, amend a will, adjust a trust, and so on. For help with all of your estate planning needs, contact the estate planning lawyers at Petrov Law Firm. We can help you keep all of your records in good order so that your wishes are carried out properly. To learn more, call 619-344-0360 today.Read More
One of the easiest ways to distribute your smaller assets (like bank accounts) is to list your beneficiaries on the accounts as recipients upon your death. When you pass away the asset will then immediately transfer to the beneficiary without any need to pass through probate.
However, when you pass your assets over without specific instructions, you might find that your assets don’t get distributed as you want. For example, you could add each adult child as a beneficiary for the bank account. And you could verbally request that the money in your bank accounts gets distributed equally among your children. Unfortunately, one of them could withdraw the full amount without consent from the other account holders.
Just a few thousands dollars could then cause a rift in your family. Work with an estate planner to clearly state your intentions in your will and create the legal mechanisms to ensure your assets are distributed accordingly. Money can have a polarizing effect within the closest of families. And while you might assume you know the financial circumstances of each of your children, chances are there are details about their personal finances they won’t share with you. Even the most seemingly responsible adult might have financial concerns that could override their loyalty to your express wishes.
Never make any assumptions when it comes to asset distribution. The passing of a loved one is a stressful time for a family. If there are any vaguaries regarding your assets, the stress of your death could translate into long-standing grudges over financial matters.Read More
When you and your lawyer write your will, you write it assuming the named beneficiaries will be alive when you pass away. However, sometimes beneficiaries pass away early. And not everyone updates his or her will to keep up to date with those kinds of unfortunate and significant changes
If you don’t change your will and one of your named beneficiaries has already passed away, then the probate court will award your assets to the beneficiary’s natural successors. For example, if you name your sister as the beneficiary of your house, but she has already passed away, then your sister’s spouse and children will step in as the beneficiaries. If you have a family member you specifically, don’t want to gain from your assets, then you will have to work with your estate planner to word the document in exact and specific ways.
Several kinds of investment accounts, banking accounts, and life insurance rewards have built-in requests and/or requirements that force you name both a primary and secondary beneficiary. These documents will often take precedence over your will. Be sure to review these documents alongside your other estate planning documents to ensure there are no conflicts.Read More
It’s not uncommon for adult siblings to hold grudges and maintain long-running disputes. Unfortunately, financial matters, like your will and your estate, are not likely to bring your children any closer together. In fact, if one of your children is left as the executor of your estate, his or her siblings might be highly critical and suspicious during the distribution phase.
Even if the questions don’t go so far as to result in one of the beneficiaries contesting the will or protesting the estate distribution process, you might find it best to have a distant relative or professional handle the distribution of assets.
The executor of your will is likely to get paid for his or her work. Frankly, being the executor of a will is hard work that involves legal documents and judicial processes. From an outsider, it might appear to be easy. And if your adult children are looking for ways to increase family tension, one person getting more than the others (as payment to handle your estate) might be reason enough to start a shouting match.
Your passing will be an emotional and stressful time for your family. Be sure to name an executor who won’t be caught in the middle of an unnecessary family fight.Read More
Trusts are a common way to pass assets along without worrying about probate court and probate costs. Generally, your lawyer will use a trust to legally hold your assets (like your house and your major investment accounts). Every trust has a grantor (also known as a settlor or trustor), a trustee, and (one or more) beneficiaries.
The grantor, settlor, or trustor is the person who created the trust by contributing assets. This person will never change. Even after death, the grantor of the trust remains the same.
The trustee manages the assets. When you create the trust, you can name yourself as the trustee of the trust. At any point, you can change the person who is named as the trustee. As part of your estate plan, you and your lawyer should name a primary and secondary successor. As soon as you become incapacitated or die, the primary trustee will take over administration of the trust.
The beneficiary or beneficiaries of the trust receives the benefits of the assets. Again, you can be the beneficiary of the trust when you create it and while you are alive. You can name as many people as you’d like to be beneficiaries of your trust, and one of these beneficiaries can also be a trustee of the trust.
At any point, you can hold all three positions of a trust you created. Your trust can exist forever and you can structure the trust so that there will always be a trustee to manage the funds for whomever you or the trustee see fit.Read More