Estate planning is often a daunting prospect for people in New York and other states. Knowing when and how to establish trusts — and making sure wills meet the legal requirements — could be daunting. A will is a document to ensure the testator’s wishes are carried out, but certain assets cannot form part of a will.
Life insurance policies, individual retirement accounts and 401(k) plans have beneficiaries written into them and can therefore not be bequeathed to anybody in a will. Regardless of what the will says, these assets will typically go to the people who are named in the policies. It is important to note that a 401(k) plan will go to the current spouse unless that spouse legally agrees that it could go to someone else.
Bank accounts with PODs also have listed beneficiaries to receive funds upon the death of the account holder. There is always the possibility that the beneficiaries on those documents are no longer alive or there are no beneficiaries listed on them at all. When that happens, the funds will go into probate. Probate is a process that allows creditors to be paid before the remaining balances go to the heirs.
Homeownership can also be complicated upon the title holder’s death. How the real estate is titled is crucial to ensure it goes to the allocated heir. Laws related to property and other assets in wills vary from state to state. New York residents would benefit from seeking the support and guidance of an experienced estate planning attorney. A lawyer will explain the laws of the state related to trusts and wills and then assist with drafting legally bounding wills that will risk being deemed invalid.