How to Make Beneficiary Decisions
Sept. 20, 2022
An estate plan can make it easier to ensure that the right person inherits your car, South Carolina home or any other assets that you own. However, it’s important that you spend time thinking about who your beneficiaries will be. Taking this time may reduce the odds of a will challenge or other issues that might occur if your preferred beneficiary is a minor or is mentally unfit to own property.
How to Account for Minor Beneficiaries
Minor beneficiaries are not allowed to own property in their own name. Instead, it must be held on their behalf by a legal adult until they reach the age of majority. If you fail to appoint someone to look after a child or grandchild’s inheritance, one will likely be named during probate by the judge overseeing the case. Alternatively, you can put assets into a trust in their name that is managed by someone who you trust.
How to Account for Beneficiaries with Special Needs
If you have a beneficiary with special needs, you may also need to appoint someone to manage their assets on their behalf. Naming a trust as the beneficiary may be ideal from an estate planning perspective if your loved one is receiving government benefits. This is because assets held in a trust may not count toward any income or other asset limits.
Choosing your beneficiaries will likely be one of the most important estate planning decisions that you’ll make. It may be worthwhile to talk with friends, family members and others prior to making any designations to ensure that they want or will make use of their inheritance.