Today I will share my final video on planning for LGBTQ families in honor of pride month. And we are going to discuss two important topics: Estate planning and proper beneficiary designations.
Estate Planning: Passing away without an estate plan could result in inadvertently leaving money to the wrong people. If you’re unmarried, your assets would likely not go to your partner without a well-defined estate plan. The same is true for any children that are not natural heirs, which is sometimes the case for same-sex parents. In these scenarios, or for anyone without children or whose partner doesn’t survive them, proper estate planning allows you to clearly determine to whom your assets go. Without a will, your state intestacy laws would dictate where your property goes. It could all pass to family members with whom you may have an estranged relationship or who you might not have spoken to in 20 years. Doing periodic estate planning reviews are essential to ensure your assets will pass according to your wishes.
Some same-sex couples have been together well before 2015. They may have some estate planning documents that predated their getting married once it became legalized. In this case, it’s imperative to review all estate planning documents to ensure that it accords with their current intent and the current laws.
Next is Reviewing Beneficiary Designations: Certain assets, like retirement accounts and life insurance policies, can pass to the beneficiary on file without the need for a will and without going through probate. The named beneficiary takes precedence over a will, meaning whoever is listed as beneficiary will get those assets regardless of what a will might state. It’s easy to overlook these designations, but they should be reviewed periodically and after any major life event. Last thing anybody wants is to have their insurance proceeds and retirement nest egg go to an ex-spouse because they never updated beneficiary designations.