Beneficiary Designations
One ancillary benefit of estate planning is that it affords you and your attorney the chance to review the beneficiary designations on your 401(k) accounts, IRAs, insurance, and other beneficiary assets. If you're establishing a trust, you may be changing these designations; even if you aren't, it's a good idea to make sure the designations accurately reflect your current wishes. In my time reviewing beneficiary designations, I've seen the following designated as beneficiary:
-Client's ex-wife
-Client's ex-girlfriend
-Client's deceased mother
-One of Client's three children. This was on a large life insurance policy, and the client's idea was that the beneficiary would take care of his two siblings with the proceeds. That strikes me as a recipe for disaster, since the beneficiary has only a moral (as opposed to a legal) obligation to share the proceeds with the others.
