When you set up a will or a trust is important that the assets that you own complement the terms of that will or trust. For example, if you have a will or living trust and it says “At my death everything is to be divided equally between my then living children”, but your IRA names your one daughter as the sole beneficiary, that is contradictory to the terms of your estate plan. The terms of your will or trust will not control the division of that IRA, it will go to the named beneficiary only. In this case, if your daughter is the sole beneficiary, she will receive the entire IRA and the other children will be left out. She is not obligated to share. It is important when doing your estate plan that the beneficiaries of your assets or the ownership of your assets is consistent with your state plan. If you start making many of your accounts joint with one or two of your children, they will become the automatic recipients of the account at your death. There are two parts to setting up an estate plan. Making sure your will or trust clearly identify your wishes and then making sure your accounts and assets do not contradict the terms of that will or trust.
Reviewing your accounts or beneficiary designations is not difficult and should be checked on a regular basis. At the same time, don’t set up your estate plan, tuck it away in the drawer and assume it is good forever.