Top Tips from a Santa Clara Will and Trust Lawyer to Avoid IRA Beneficiary Form Mistakes

Putting together a solid estate plan with your Santa Clara will and trust lawyer is an important step in protecting the future for you and your family.  In order to make sure that things go the way you’ve planned, it’s a good idea to occasionally double check who you have listed on your IRA beneficiary form.

In order to keep things in line with your estate plan, remember that the beneficiary designation form may be the final voice on who gets your IRA.  That can happen, even if you and your estate planning lawyer have rewritten your will.  (Yes, the designation form can outrank your will!) If you’ve had a change in your relationship with the person you previously designated, you’re going to want to get that form changed.

This isn’t the only problem your will and trust lawyer in Santa Clara might be able to identify when it comes to the beneficiary designation form.  For example, it’s actually pretty common for individuals to not even know where that form is, despite the fact that their IRA may be the most valuable thing they’re planning to leave behind.  If you haven’t seen a copy of your form in a while (or ever), you or a Santa Clara estate planning lawyer need to contact the IRA administrator and get a copy to keep somewhere appropriate.

When you get that copy, take the time to review it.  You may see that plenty has changed since you set up your IRA.  Children, divorces, spouses, and even grandchildren may have come into play since that time.  Along those lines, if you’ve lost a child but want to ensure that his or her family receives a portion of your IRA, you will need to list them on the form because a deceased child may not inherit.  In fact, any time a beneficiary has passed away, it will affect your estate.  You can make this a little less of an issue by making sure to name backup (“contingent”) beneficiaries.

If one or more of your beneficiaries is under the age of 18, your Santa Clara will and trust lawyer may advise you to use the IRA to fund a trust instead.  This will give you a whole lot more say in how the money gets used.  In fact, even if you are leaving it to someone older, a trust still might be the way to go for several compelling reasons.

These are just a few of the complications that can come along with not properly designating beneficiaries for your IRA.  There are others that might come into play, as well, and a Santa Clara will and trust lawyer should be able to go through them with you to create the best plan possible.