Many people are diligent when thinking about what will happen to their assets and real estate after they are no longer with us. While it can be an indelicate topic, some of us are conscientious about doing estate planning that covers all the bases. Sometimes, we have more than we realize, including bank accounts, retirement plans from our jobs, brokerage annuities and college savings plans. All of these should have designated beneficiaries that are current, because if not, our money and things could go to the wrong people.

As time passes, our wishes change. Relationships come and go, we get married, divorced and even have falling-outs with friends and family. There are some common pitfalls it would be worthwhile to specifically outline in order to avoid headaches later.

First, it is beneficial to get advice on what your state of residence laws say regarding one’s spouses. In some states, the spouse automatically is the beneficiary; in others, assets sometimes go to the ex-spouse, which is not what you might want.

Job changes can also affect your pension plans. When you roll over your retirement funds, your beneficiary will no longer have access to them unless you name them on the new account. Perhaps our beneficiary passes before we do. Another caveat is that our financial institution may have changed ownership. In the merging of banks, brokerage firms and mutual funds groups, some institutions get rid of older accounts. This cleans house for them but is very bad for you.

It is advisable not to appoint a minor as a beneficiary, as this could get messy with appointing conservators until the minor comes of age. Another complication could be if your beneficiary becomes disabled, which could affect that person’s �countable resources’ from Social Security or other benefits. In both of these cases, the solution might be to form a trust. A financial planner can advise you on how to do this.

Lastly, think of February 14 as a time to review your beneficiaries and estate planning. You will have received your 1099, so you will be clear as to what your contact information and assets are at your financial institution. There is no better way to show your heirs that you will be giving them a precious gift in your memory for years to come.

Source:Forbes, “The Big Estate-Planning Goof You May Be Making” Harper Willis, Dec. 16, 2013

When the retired president of a local labor union passed away at age 79, he left his entire legacy to his best friend. The recipient of his $250,000 estate, and a house of over 4,000 square feet, will be well-provided for until the end of his life. The aging heir is almost blind, deaf and crippled. He is also a cat.

Along with his adopted brother, the kitty will be cared for by one of the deceased’s daughters, who has moved into the spacious residence to fulfill her father’s wishes. Both house cats, according to the last will and testament of the woman’s father, will stay in the home located in a gated community.

Reportedly, the woman’s brother who took his father’s place as the union’s president, claimed his late father had made up the will several weeks prior to being admitted to the hospital, after being diagnosed with cancer. The lucky cat will stay in his familiar surroundings, the only home he has ever known. The man says his father and the feline spent hours sitting on the sofa, a unique bond forming between them. Family members took the will’s terms in stride and promised to respect the father’s wishes. They speak fondly of their father, calling him an extraordinary individual who had put the well-being of others before his own. He was an exemplary labor leader and had marched for civil rights with Dr. Martin Luther King.

People work a lifetime to acquire wealth. An individual’s final wishes may designate some surprising beneficiaries, but one’s final wishes need to be respected and carried out, regardless of any eccentricities inherent in those decisions. The critical nature of making sure we have our affairs in order cannot be overestimated. The late labor president is not the first to prefer his pet over people when designating the heir of his choice. One Italian heiress left $13 million to her cat, and in 2007, Leona Helmsley left her Maltese $12 million. It is, after all, a right we have strived for our entire lives. Attorneys can help with the creation of such wills and ensure these important estate documents are carried out to the letter.

Source: commercialappeal.com, “Man’s bequest of home, $250,000 ensures cushy life for feline beneficiaries” No author given, Nov. 23, 2013

Concerns have been raised regarding disputes surrounding a late, elderly woman’s decision to leave almost $2 million to a local police officer. The woman’s last will and trust has been called into question, based on beliefs that she was not of sound mind when she initiated last minute changes in her estate.

Opposing legal advisors claim the elderly woman was befriended by a local police sergeant after he answered calls she made regarding an intruder in 2012. She had been diagnosed with dementia in 2010, but allegations suggest the law enforcement official had helped her to draft a new version of her last will, which included changes to her estate plan that benefited him.

Attorneys representing two leading cancer research facilities claimed they had previously been beneficiaries and were slated to receive a half a million dollars upon her death. Now, under the disputed changes, the facilities will receive only $80,000.

A hearing has been scheduled in probate court to discuss the dispute. The police officer has denied any charges of malfeasance on his part, stating he had only assumed the role of a friend with the old woman. He said that any changes to her estate planning were done by her acting alone. Although he claimed that she considered him closer than family, she excluded her own disabled grandson from her will. The grandson later testified that he believed his grandmother was mentally incompetent.

Additional named beneficiaries include local fire and police departments, as well as the school district. Several individuals and entities have come forward contesting the late changes to the will which resulted in their diminished roles as beneficiaries. The situation has been cited as an example of official public corruption.

Our society frequently isolates our elderly. We put them away into nursing homes or assisted living. Some elderly are not thought of until the time of their death when the will comes to light naming beneficiaries in the distribution of assets. At the end of the day, each person is responsible in naming those to benefit upon his or her demise, and ultimately up to the same individual to determine what should be done with his or her own assets and property.

Source: seacoastonline.com, “Legal arguments filed in cop’s inheritance dispute” Elizabeth Dinan, Nov. 16, 2013

The Texas Department of Insurance is offering a new resource, called the Life Policy Locator Service, which can be immensely critical in helping those named as beneficiaries to claim what is rightly owed to them.

It has been common for confusion to result when a relative passes on and the designated beneficiary might not know the name of the insurance company issuing the policy or other binding agreement. This can result in unclaimed benefits for those entitled to claims. Now the executor can search for a lost annuity contract or insurance policy on the insurance website.

The department has stated it will take each request and forward it to the insurance companies who are licensed and participating in the program. They forward the requests up to thirty days from when the request is initiated. Companies will search their databases records to see if there is a policy in the name of the deceased. They then attempt to determine if the policy the person named is the beneficiary.

There are currently almost 30 insurance companies in the state of Texas who are voluntarily participating in the locator service. They have provided some tips to help locate a lost policy or contract for a beneficiary, including examining bank statements that track payments to life insurance companies. Checking other records is facilitated with the use of records and notes in smart phones.

According to law, if a policy’s beneficiaries are not located within three years, the insurance company must send the death benefit to the state as part of an unclaimed property fund. This, unfortunately, happens quite a bit so it is a good idea to stay current with records. In order to receive more information about this, it would be wise to go to the web page of the comptroller to study the area in which they list unclaimed property or benefits.

The death of a loved one can be heart-rending. Being able to carry out the final wishes of a family member or close friend who has designated a heir or beneficiary can be greatly facilitated by availing oneself of this new Texas insurance department law.

Source: timesrecordnews.com, “Think you’re an heir? Ask the state” No author given, Oct. 24, 2013