To avoid issues, review and update the titling of all your accounts.
Most of your accounts and assets have a title that makes clear who the owners and beneficiaries are. For example, the title may include the names of a parent and child, your name along with someone else’s as your preferred beneficiary or even the name of a business. When it comes to establishing and updating these titles, the process may seem straightforward, but one misstep or oversight could potentially complicate your estate plan.
Ensuring that titling on your bank, brokerage and other accounts is aligned with your overall financial plans will guarantee—among other benefits—a smooth transfer of assets to future generations. As with most financial responsibilities, planning is essential, as is scheduling regular reviews with your Regions Wealth Advisor.
Follow these four suggestions to minimize confusion around titling and ensure your assets are transferred according to your wishes.
1. Two Names May Be Better Than One
Accounts titled in your name alone will be paid to your estate upon your death. But if an account is jointly owned with someone who has “right of survivorship,” or if an account names one or more beneficiaries, its assets will be distributed upon your death to the joint owner or the named beneficiary. Assets held in either of these types of accounts will not be distributed according to the terms of your will.
2. Adding Beneficiaries May Help to Avoid Estate Slowdowns
As discussed above, any assets held in accounts without a designated beneficiary will be paid to your estate and bequeathed according to the terms of your will. But this might slow down the transfer of ownership of the assets and accounts, and it may also open them up to probate.
If you would prefer that your assets and accounts are quickly distributed or transferred directly to heirs, you can do so by establishing them as beneficiaries to the accounts.
3. Keep Your Titles and Estate Plan in Sync
Let's say your children are the primary beneficiaries named under your will. You have an investment account titled solely in your name that you want your children to inherit. But you later use some of the account’s assets to purchase real estate with a sibling and title the property as joint with right of survivorship. When you pass away, your children could receive less inheritance than you originally intended, while your sibling inherits the full value of the real estate. Talking about moves like this with your advisor before you make them will ensure your accounts are titled to benefit all parties according to your wishes.
Make sure to evaluate the consequences of such moves to your estate plans and consider how to title or re-title your accounts and assets accordingly.
4. Review Your Account Titles Regularly
Titling accounts and naming beneficiaries on retirement accounts and insurance policies is an ongoing process. You’ll especially want to review your choices whenever you or an heir experiences a significant life event, such as a birth, adoption, marriage, the sale of a business, divorce or death, as well as when tax laws change.
Your Regions Wealth Advisor can help you review the titles on your various accounts and assets to help ensure they are accurate, up to date and aligned with your overall estate plans.
Talk to Your Regions Wealth Advisor About:
- Whether the current titles of your accounts match your estate plan, or if they should be reviewed and revised
- How to build a legacy plan to make sure your financial wishes are passed along to the next generation
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