You met with a lawyer a number of times to have a fairly complicated will prepared that includes carefully tailored provisions creating trusts for your children and grandchildren. Your will indicates who will serve as the initial trustee and who will serve as the successor trustee if the person you chose cannot continue to serve. Your will has specific directions limiting the purposes that will authorize your trustee to distribute funds to your children. It also indicates who will receive the funds if one of your children or grandchildren dies before all of the funds are distributed.
When you die, will your assets be held for your family and distributed in accordance with the terms of your will?
Perhaps they will, however, far too often, the answer to this question is that your assets will not be distributed in accordance with your wishes.
Why is this? The reason is not because someone challenged the validity of your will. The reason is that at some point in time you signed beneficiary designations with respect to the accounts where your assets are held. For example, if you have a stock brokerage account or mutual fund account and you signed a beneficiary designation indicating who will receive the funds in the account following your death, the beneficiary designation will supersede your will. If you have an IRA, the assets held in your IRA will be distributed in accordance with the beneficiary designation that you signed, and not in accordance with your will. Life insurance proceeds will be distributed to the named beneficiaries of the policy. Joint assets will pass to the surviving joint tenant.
Sometimes there are good reasons to designate beneficiaries with respect to your assets. You can often designate trusts created during your lifetime or created under your will as the beneficiaries if you wish.
The important thing to remember is to review all of your assets with designated beneficiaries and work with your attorney to coordinate your beneficiary designations with your will and your estate plan. This will help to ensure your wishes are followed after your death.