I recently ran across this great little article on the important question of which controls – The will or the named beneficiary designation?

This particlular article is based on UTAH law but the question (and the answer) is pretty much the same under Pennsylvania law. In almost every case, the beneficiary designation on life isnurance, retirment plans, and bank and stock accounts will control. So if you have changed your will, it is also essential to make sure that your beenficiary designations are coordinated with your estate planning.

One of the most common estate planning mistakes is the failure to coordinate what the will says with how the assets are actually owned and with the beneficiary designations.

The take away? Make sure that your estate planning attorney helps you to coordinate the beneficiary designations with your documents. Make sure to ask if your tax payment clause under your will is appropriate given the way you hold and dispose of non probate assets through such beneficiary selection.

Which controlls your assets - the will or the beneficiary designation?

The firm serves clients doing wills, trusts, estate and asset planning in Chester County, Montgomery County, and Bucks and Philadelphia County.

David Frees has been selected as “the Best” Trust and Estate Lawyer on the Main Line according to Main Line Today Magazine.

610-933-8069
dfrees@utbf.com

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James Douglas Kaune, Attorney to be?

This article was posted
by Douglas L. Kaune, Esquire
Estate Planning, Estate Administration, Wills,
Trusts, Elder Law,
Unruh, Turner, Burke & Frees
Phoenixville, Malvern, West Chester
Pennsylvania Attorney
dkaune@utbf.com PH: 610-933-8069

I have had a recent addition to the family, my son, James Douglas Kaune.  Welcome to our lives James!! Taking my own advice, my wife and I immediately updated our estate planning documents including wills, powers of attorney and trusts.  We also modified our beneficiary designation forms in IRA’s, 401k’s and life insurance to name the testamentary trust for my son if something happens to my wife and me.  We want to make sure James is well taken care of and that the correct trustee is apppointed to oversee his inheritance. This will help to make sure these assets are protected from poor spending habits, future creditors and possible divorce (A long time from now I hope!)  Take a look at this article for some advice when determining what type of trust, what trust provisions and what trustee would be best suited to take care of the assets you leave for your children. We are looking forward to long healthy lives with James, but want to make sure that we take all the necessary steps to make sure he is well cared for under all circumstances.

Douglas L. Kaune, Esquire
Serving, Chester, Montgomery, Delaware
Bucks and Philadelphia Counties

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One of the most frequently neglected parts of the estate planning process is the proper use of beneficiary designations on life insurance, IRA’s, 401k’s, annuities and other similar assets. Failure to properly prepare and update a beneficiary designation can significantly change the disposition of assets someone intends to be carried out by his or her last will and testament.
I recently represented the Executor of a Chester County PA estate. I have changed the facts, but have maintained the essence of the issues for our discussion. The decedent was survived by a 18 year old son. One month before the decedent died, he signed a will designating a trust for his 18 year old son as the sole beneficiary of his estate believing that this was all of the “estate planning” he needed.
Unfortunately, five years before his death, the decedent submitted a beneficiary designation for his $600,000 life insurance policy naming his then 77 year old mother as a primary beneficiary. I have been told that the expectation was that the decedent’s mother would “watch over” the money for her grandson. The decedent’s mother predeceased him and was not available to collect the insurance proceeds. The contingent beneficiary, the decedent’s brother, is now in line to collect the proceeds from the policy. He has informed the family that he is having financial difficulties and has no intention of sharing the insurance proceeds with the decedent’s son or anyone else for that matter. WOW! This has sent shock waves through the family and significantly diminished the security of the decedent’s son. Although likely contrary to the decedent’s true intention and morally questionable, the decedent’s brother is legally entitled to keep the $600,000 in insurance proceeds and the surviving son does not get one cent.
This case is a flashing neon sign for everyone to check their own beneficiary designation forms and make sure that they are properly integrated into the estate planning process. The decedent should have created a new beneficiary designation form naming the son’s trust under the will as the beneficiary. This would have allowed the trustee to claim the proceeds and then manage the assets for the son until a later date. A will is not always enough!!

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Douglas L. Kaune
dkaune@utbf.com
610-933-8069

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Douglas L. Kaune or dkaune@utbf.com

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