December 6, 2017
A properly executed will is perhaps the most important piece of your estate plan. It determines what happens to your property after you pass away and makes sure your last wishes are carried out.
However, there are some limits to what a will can accomplish. One of these limitations occurs when you have property that passes to someone else outside of your will and the probate process.
Property That Passes Outside of Your Will
Several types of property may not become part of your estate, and will be transferred to certain individuals regardless of what your will says. Some of these assets are:
- assets owned by joint tenants will pass to the other tenant
- assets with designated beneficiaries, such as retirement accounts or life insurance policies
- other accounts that are payable on death to named beneficiaries
For many people, these types of assets could make up the bulk of their estate. If you own your home jointly with your spouse and have a named beneficiary on your 401(k) or IRA, that could cover the majority of your assets without the need for a will.
Assets that are placed into a trust will also pass outside of the probate process. These assets will be distributed according to their respective trust documents.
Why You Still Need an Estate Plan
Even if some of your assets will transfer to joint owners or beneficiaries, you still need a valid will and an estate plan. For some, a simple will is sufficient, while others may need to consider using trusts, powers of attorney, and other estate planning strategies.
If you were to suddenly acquire new property without a joint owner or named beneficiary and didn’t have a valid will, then the North Carolina intestacy laws would control who receives this property when you pass away. These laws may not reflect your wishes and could lead to undesirable outcomes.
An estate plan should protect your current assets, but it should also consider unforeseen events that could happen in the future, like divorce, disability, or the acquisition of new property. A skilled estate plan attorney can help you plan for these events and update your estate plan when needed.
The lawyers at King Law can help you plan for what happens after you’re gone, and we’re here to help you get a better sense of where you stand. We invite you to come in and talk with one of our attorneys in person during a consultation. Our number is 888-748-KING (5464).