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Importance of Proper Beneficiary Forms

Estate planning and asset protection. Looking at estate planning and the importance of proper beneficiary forms in order to avoid financial snafu can ward off problems in the future. This is especially important for high net worth individuals. An Elder Law and Special Needs Law attorney should be able to draft an estate plan that analyzes the effect on a loved one’s public benefit eligibility or tax status, says the Office of Chronic Care Advocacy.

To avoid such unfortunate outcomes it is important for a senior to keep all accounts up to date, especially when there is any change in status such as a marriage, divorce, death, birth, adoption, etc., in the family.

It would be prudent for seniors, as well as any family members with dependents, to take these five steps to keep financial missteps at bay and consult with their professional estate advisor:

1. Update beneficiary forms at least annually. This is crucial, because contrary to what most people believe, in 99 percent of the cases beneficiary forms override a will.

2. Designate percentages next to the names of beneficiaries, or write “in equal shares” if the assets are to be distributed equally.

3. If your bank or other financial institution changes its name or merges with another bank, fill out a new form. It goes without saying: old forms with obsolete names or outdated information may not be recognized as valid when the time comes.

4. Keep hard copies of everything on file. This is especially important if you fill out forms online. Keeping a copy in your bank’s safe deposit box is a good idea, as is keeping a copy in a secure place at home. What to keep: beneficiary forms, including “payable on death” forms and “transfer on death” forms.

5. Hire a professional. An attorney or financial planner who specializes in estate planning, or a certified estate planner licensed in your state, will know the laws for properly setting up and maintaining your accounts. A professional can also help you consolidate accounts and update your financial plan so that you are retirement ready. The best way to enjoy your reverse mortgage and later life is to know at the outset that all your assets are protected, both for you and for those you love.

Contact an On Q Reverse Mortgage Consultant for full details and to see if a reverse mortgage might be right for you.

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