Certain accounts may have you complete a beneficiary designation when you open them. Common examples include retirement accounts or other investment account, as well as life insurance policies. These designations control who is to receive the account at your death—regardless of what your will says.
It is important to ensure that your beneficiary designations are up-to-date and are coordinated with your other estate planning documents. For instance, under current law, if your will leaves everything to your son, John, and the designation on your retirement account leaves it 100% to your ex-spouse, Jane, Jane will receive the account.
In some situations, you may wish to have your estate or revocable trust be the beneficiary on these designation forms. In this instances, the account with flow in accordance with your other estate planning documents. However, this is a case-by-case decision and doing so may have negative tax implications in some instances.
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