The most valuable assets people own can become sources of conflict and concern after their passing. Loved ones may fight over certain resources or worry about losing them during the challenges of estate administration.
Home equity is often a priority consideration during estate planning and estate administration. People may also worry about the deceased individual’s retirement savings. Frequently, professionals spend decades setting aside capital for their golden years.
Are retirement savings at risk when the account holder dies?
People can plan to preserve their savings
In some cases, those who have saved fastidiously for decades include their retirement savings accounts in their wills. They might share the account with their spouse as a co-owner.
Other times, they may file a transfer-on-death document with their financial advisor. They can allow their spouse, surviving children or other specific beneficiaries to receive the balance of their savings after their passing.
Even without prior planning, retirement savings typically have protection when an account holder dies. If they are not included in an estate plan or there is no estate plan, then it may be necessary to wait for the courts to apply intestate succession laws. Waiting until the personal representative has addressed financial obligations might also be necessary in cases involving an estate plan that does not allow for the immediate transfer of the account outside of the probate process.
Identifying high-value assets can be beneficial during estate planning and the early stages of a state administration. Retirement accounts may require careful consideration, given the value that they represent. Testators who understand their options can choose the best means of passing their retirement savings to their intended beneficiaries.