The most effective estate plans are not simply signed and stored away. They are funded, coordinated, maintained and reviewed to ensure they continue to accomplish your goals and protect the people you care about most.
Sharon L. Wick, Partner
While there are other benefits to the use of a revocable trust in your estate planning, one of the primary benefits is to avoid the need to probate your Will. This benefit is only available if all of your assets are actually titled in the name of the trustee of your revocable trust or have a beneficiary designation. If you continue to own the assets in your name alone that do not pass by beneficiary designation, then upon your death, your executor will be required to petition the court to have your Will admitted to probate. While not fatal, it defeats the purpose of having a revocable trust.
As a general rule, all assets, other than retirement plans, should be titled to the trustee of the revocable trust: bank accounts, investment accounts, real estate, ownership interests in corporations or partnerships, tangible personal property, etc. While you can designate beneficiaries to receive most assets upon your death, if you name a person directly, then the terms of your trust will not govern with respect to that asset, which may not be the outcome you want. You should work with your estate planning attorney to review the detailed list of your assets to make sure that your revocable trust is properly funded.
Benjamin S. Cranston, Partner
Coordination between your estate planning documents and beneficiary designations on bank, investment, and retirement accounts and life insurance policies is an essential, but often overlooked, part of the estate planning process. Beneficiary designations direct how an account or policy will pass upon the owner’s death. A valid beneficiary designation generally controls over contrary provisions in the owner’s Will, allowing the asset to pass directly to the named beneficiary.
Beneficiary designations can offer several advantages, including avoiding probate and allowing beneficiaries to receive assets more quickly. Depending on your estate plan, however, it may be preferable or necessary for certain assets to pass to your estate or to a trust created under your Will.
You should consult with an attorney before changing your beneficiary designations. Designations should also be reviewed at least annually and following significant life events, such as births, deaths, marriages, or divorces.
Holly A. Beecher, Partner and Trusts and Estates Practice Group Leader
One of the most important parts of estate and disability planning is choosing the right person to act on your behalf if you are unable to make decisions for yourself. Whether named as an agent under a power of attorney, health care proxy, trust agreement or as a fiduciary in your estate planning documents, this individual plays a critical role in carrying out your wishes and protecting your interests during challenging times.
It is important for an agent or fiduciary to understand the responsibilities that may come with the role. Depending on the document, responsibilities may include managing finances, paying bills, handling investments, making health care decisions, communicating with family members, maintaining records or administering assets according to the instructions provided. Fiduciaries are generally expected to act in the best interests of the person they serve, avoid conflicts of interest and keep accurate records of their actions.
For those creating or updating an estate plan, open communication is essential. Consider speaking with the individuals selected before an emergency arises. Discussion of values, goals and expectations should occur so they understand your wishes and are comfortable serving in the role. Providing copies of relevant documents and information about important contacts, accounts and advisors can help your chosen agent or fiduciary carry out their duties effectively when needed.
Nicholas J. Thompson, Senior Associate
The use of online tools, such as a Legacy Contact, can facilitate a smoother administration of certain digital assets of your estate by allowing you to designate a trusted person to access those assets or to provide direction regarding their disclosure, or nondisclosure. Common digital assets to keep in mind are your everyday online accounts, such as email accounts, financial accounts, social media accounts, and digital files (photographs, documents, videos, audio files) or various cryptocurrencies to name a few. Although these features are not available for every digital asset or platform, it is important to use them when available as there is an important hierarchy to consider after your death. Online tools are at the top of the hierarchy and take priority over designations in your estate planning documents which in turn generally have priority over the general terms of service of an online platform. For example, Apple allows a user to designate a family member, friend, or a trusted person as a Legacy Contact. After the user’s death, to file an access request, the Legacy Contact may provide Apple with the user’s death certificate and the access code generated when the designation was made. Although Apple’s requirements are subject to change, this may provide quicker access to certain digital assets and reduce the need for a lengthy court proceeding.
Madeline J. Drechsel, Associate
An estate plan is most effective when your documents, asset information and account details are organized and easy to locate. Consider keeping a list of assets and accounts, information regarding digital assets and passwords, contact information for your financial and legal advisors, and the location of your original estate planning documents, while also making sure a trusted person knows where to find this information. In addition, disability planning documents should not be signed and forgotten. Providing your financial institutions with copies of your power of attorney and filing your health care proxy with your health care providers can help prevent delays in an emergency. These administrative steps may seem insignificant, but they can be crucial in reducing stress, minimizing administrative burdens and making a difficult time a little easier for the people you leave behind.
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