The month of April is Financial Literacy Month, so we at Family Estate Planning Law Group will be focusing on the importance of assets, beneficiary designations and the impact of correctly titling assets. When clients focus solely on documents, they never learn the importance of aligning asset ownership with the estate plan, and that can have a detrimental effect on the family and inheritances later on.
This is one of the primary estate planning mistakes. We know that life changes, what we own changes, our family situations change and the law changes. However, how many of us speak with our estate planning attorney regularly about these changes? Even moving to a new company or a new position with new employee benefits can impact your estate plan and create new assets that need to be aligned.
Very few people work not only to align asset ownership and beneficiary designations with the plan, but also verify the correct alignment with financial institutions and track changes in assets or in policy at the institutions over time. To accomplish this, clients, estate planning attorneys and other financial professionals must work together not only to create the plan initially, but to keep it up to date.
Without this teamwork, assets won’t be aligned the way you intend, much less in a way that will take care of your family at your death or disability. It’s essential to keep track of what you own, who has authority over those assets—or over healthcare decisions—should you become incapacitated and who should receive the assets at your death. Keeping track means less confusion for your loved ones after you pass away.
It’s also important if you incorporated trust planning, estate tax planning or other planning to protect assets left to heirs from divorce, creditor or bankruptcy actions. Without proper alignment of assets, those carefully-constructed trusts may never be “funded” with assets, meaning all your hard work to protect your heirs’ inheritances from creditors and other issues may go to waste. Without correct alignment of assets with your plan and ongoing tracking of those assets, your estate plan will likely fail.
That’s why we at Family Estate Planning Law Group work with all our clients on an ongoing basis. As our clients’ lives change, as assets change and even as values change, we want to ensure their estate plans reflect their wishes and will work the way they were intended to work at the time of clients’ death or incapacity. Only with this ongoing relationship do we feel assured clients’ estate plans have the best chance of succeeding.
We rarely find helpful information on asset alignment, verification and tracking, so we hope this month’s blog series illuminate the importance of this vital process and encourage communication between clients, attorneys, financial professionals and other advisors. For more information, explore our website and contact us to schedule your consultation today!