People starting new jobs in Virginia are often given a bunch of forms to fill out. Some of these forms require naming beneficiaries for such things as life insurance programs, stock options and retirement savings plans. Most people fill out these forms and forget them. Unfortunately, this could lead to potential problems in the future.

When an individual passes away, many people assume a will is the document that defines who gets what. However, not all assets are controlled by a will. An assortment of plans that can be significant sources of assets may be set up so designated beneficiaries receive whatever payouts are associated with those plans. The potential estate planning blunder here is having plans that haven’t been updated since the first day of employment, which could be several years ago.

Many people name a spouse as a main beneficiary and children as contingency beneficiaries. But changes in circumstances can result in an unexpected chain of events. For instance, if the spouse passes away at a relatively young age, assets could be passed along to surviving children as soon as they reach the age of maturity, which is usually 18 or 21. This may not be what was intended. In some cases, an individual that has worked their way up the corporate ladder may reach a point prior to death where the bulk of their assets are in company stocks and retirement plans, and therefore not transferable with a will.

It’s because of situations like this that an estate planning lawyer often recommends reviewing beneficiary designations periodically. It’s a process that can be done fairly quickly. An attorney may also recommend that a client consider setting up a trust to manage asset distribution in a more efficient manner.