The Essential Step in Estate Planning

Estate planning is more than just setting up a will—it’s about ensuring your loved ones receive what you’ve worked hard for without the hassle. Adding direct beneficiaries to your accounts can save time, money, and stress for your heirs. Don’t forget to take this crucial step after creating your estate plan!

“So when it comes to estate planning, there’s a lot of people who don’t understand exactly how that process works and all the benefits that could be added by just adding a direct beneficiary on your accounts. So you have your IRA, you have your 401(k), you have your brokerage account, all these accounts. If something were to happen to you, you need some sort of owner once you pass on. This is what your beneficiary is. So, by going onto your accounts and adding a direct beneficiary, you’re really helping your heirs to have an efficient manner of receiving those assets. Any asset that doesn’t have a beneficiary listed, actually goes to what’s called probate and that is public record. It can be very expensive and timely for the courts to decide who is the rightful heir of those assets. And so by adding just a direct beneficiary onto your accounts and making sure that you either have at least a primary, and possibly even a contingent, you’re really helping your heirs to create an efficient way to pass on your assets.

Taking the steps to create an estate plan is very important and a lot of people do this, which is great, but what can happen is they don’t actually end up following through and taking the last few steps of adding the correct beneficiaries to their accounts. So once you create your estate plan, it’s very important that you go back and look at all the accounts that you have: your work plans, your 401(k)s, your HSA, your brokerage accounts, your checking accounts and make sure that you go and add the beneficiaries on them directly in order to create the most efficient process of passing on those assets.”