Getting one’s affairs in order is not complete until all loose ends are tied-up.   Loose ends can otherwise unravel some part of one’s estate plan.  Let’s take a look at some common problem areas.

Examine who are the legally designated primary and alternative beneficiaries to your retirement accounts.  Retirement plans are a sizable element of many people’s estates.  At the participant’s death, retirement plans transfer without probate according to the participant’s designation of death beneficiary form.  You need to make sure that your designation of beneficiary form names both primary and alternative beneficiaries and is properly executed.

If the retirement plan includes marital earnings, then it is necessary to have your spouse countersign the beneficiary form to transfer 100% of the plan benefits.  Customized designation of alternative beneficiary instructions can and should usually be attached to the standard designation of beneficiary form.  That way, you can both tailor your designation of alternative beneficiaries beyond what is allowed by the form and not be restricted to accept the boiler-plate contingency planning that the form otherwise imposes.

If your trust is named as beneficiary of a retirement plan then is the trust properly drafted?  That is, after you die does your trust meet the IRS regulations to allow maximum income tax deferred growth (i.e., based on the individual beneficiaries’ own ages) with the trust as beneficiary?  Is naming the trust as the beneficiary of the retirement account necessary, or should you simply name the individual beneficiaries directly?  Typically the individual beneficiaries are named, and a carefully tailored trust is only named as beneficiary when necessary, such as in the case of protecting a special needs beneficiary eligibility to receive needs based government benefits or to protect the beneficiary’s inheritance assets from his/her own creditors.

Make sure that you have appropriately transferred title to all assets that should be in your living trust.  Assets held in your name outside of your living trust will otherwise be subject to probate (if the assets’ total gross value exceeds $100,000), unless the assets are non probate assets; such as assets owned in joint tenancy and financial assets that pass to designated beneficiaries.  People sometimes neglect to transfer title to all their real property (including out-of-state property) into their living trust.   Also, if a special needs trust to be established pursuant to your living trust, after you die, then it is doubly important that they be held in your trust.

Pets sometimes get over looked.  Have you provided that your pets be taken care of when you are disabled and after you die?  Does your power of attorney authorize your agent to pay for the care and custody of your beloved pet during periods when you are sick and unable to take care of your affairs?  How does your trust or will provide for the care of your pet after you die?  Does it ensure that only humane “no kill” shelters can receive your pet?

Have any of your beneficiaries’ circumstances materially changed?  That is, does leaving their inheritance outright to them still make sense?  Is a special needs trust now needed to protect a special needs beneficiary’s continued receipt of needs based government benefits?  Is a custodial account now necessary for an under aged (minor) beneficiary?

Tying up loose ends prevents unintended negative consequences.  Identifying any loose ends is why you should periodically have your estate plan reviewed.  A general rule of thumb is to examine your estate plan once every five years, and sooner if any changes occur that materially impact your existing plan.


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“Serving Lake and Mendocino Counties for nineteen years, the Law Office of Dennis Fordham focuses on legacy and estate planning, trust and probate administration, and special needs planning. We are here for you. 870 South Main Street Lakeport, California 95453-4801. Phone: 707-263-3235.”