Idaho estate planning takes into consideration much more than just the assets that you own. It also considers all the circumstances of you and your life individually as well as your family and loved ones. Additionally, as Idaho estate planning attorneys our goal is to accomplish what your intent is for yourself and your loved ones. One area that is often overlooked when it comes to estate planning is dealing with your retirement accounts. Many people believe that the directions they leave in their last will and testament covers everything they own, including their retirement accounts. Because this is not accurate, we often provide assistance to our clients concerning handling their retirement accounts as a part of their estate plan.
The Racine Law Office Team of estate planning attorneys consists of partners Randy Budge and Lane Erickson and attorneys Nate Palmer and Dave Bagley. Our team of estate planning lawyers takes pride in knowing that they have the experience and ability to assist each of our estate planning clients customize their estate plan to fit their personal needs. We have assisted our clients for over 70 years and in doing so have earned the highest ratings possible from legal ranking services including Justia, AVVO, and Martindale & Hubbell. These ratings are based on comments made by attorneys and judges and on specific reviews given from clients.
When it comes to your estate planning, here are three specific things that you should understand about your retirement accounts.
1. Retirement Accounts are Separate From Estate PlanningThe first thing that you should know and understand about your retirement accounts is that they are in fact separate from your estate planning. What this means is your last will and testament has no control over your retirement accounts. In other words, if you state in your last will and testament that you are leaving your retirement accounts to your wife, your last will and testament will have no bearing on whether your wife actually gets your retirement accounts or not. The reason for this is because your retirement accounts are controlled by a separate contract.
When you opened your retirement accounts you signed a contract document with the administrator holding that account. The documents that you signed indicate that the administrator will hold the account based upon the applicable laws associated with retirement accounts. Additionally, included as a part of the contract that you signed was a beneficiary form.
In the beneficiary form you are given the opportunity to list the individuals that you want to receive your retirement account monies if you pass away. Typically this form is called a beneficiary designation form. Normally on this form you are given the opportunity to list who your primary beneficiary is. You are also given an opportunity to list who your secondary beneficiaries may be. It is only if you leave the beneficiary designation form blank that your retirement account monies will actually become a part of your estate after you die which will then be controlled by your last will and testament. As part of your contract, the beneficiary form controls who your retirement accounts will be given to upon your death.
2. Keep Your Beneficiary Choices UpdatedThe second thing that you should understand is that because the beneficiary form controls who your retirement account money will go to when you die, it is important for you to keep your beneficiary choices updated. The easiest example to illustrate why this is important is divorce. Imagine that when you first created your retirement account and signed the beneficiary forms you listed the spouse you were married to as the primary beneficiary. Now imagine that several decades have gone by and that your retirement account holds a substantial sum of money. However, during this time it’s possible that you may have divorced your first spouse. If you do not change your beneficiary designation forms your ex-spouse may still be listed as the primary beneficiary on your retirement accounts.
From the example listed above you can see that it’s possible that your retirement account monies could go to someone that you would not to later in your life. It’s for this reason that we recommend to all of our clients that whenever they go through any major life change they review their beneficiary designation forms and make sure that the individuals listed on the retirement accounts are still the people they choose at that time.
What are major life changes? They are simple. They include the birth of an individual, the death of an individual, divorce, marriage, or just the passage of a long period of time. When any of these events occurs, your estate planning, including the beneficiary forms on your retirement account contracts, should be reviewed. In fact, really, it is wise to look at your beneficiary designation forms on a regular basis to make sure that you have listed the individuals that you intend your retirement account money is to go to if you were to die.
3. Keep Good Records and InstructionsThe third thing that you should keep in mind when it comes to your retirement accounts and your estate planning is that you should keep good records and instructions. If your family cannot find any information that you even have a retirement account, it is unlikely that they will ever receive the money that you have saved. For this reason, we recommend to our clients that they keep an organized record of all of their accounts including retirement accounts so their family has the information needed if you were to die. Nothing fancy is required. A simple binder, or filing cabinet with updated statements from your retirement account would work. This would provide your family with the name of the administrator, telephone numbers, account numbers, and updated balances of the monies in your account.
Enlist an Idaho Estate Planning Attorney to Help YouOur team of Idaho lawyers can help you with any of your estate planning needs if your spouse has passed away. Whether you are seeking to create or review an estate plan for yourself or would like to help a loved one, we are available to discuss your options and answer your questions at an initial consultation. Call us toll free at 877.232.6101 or 208.232.6101 for a consultation. You can also email us directly at racine@racinelaw.net. We will answer your questions and help you solve your Idaho Estate Planning problems.