An often-overlooked financial asset may be buried in your safety deposit box right now! That’s right, it’s time to take a look at those long-forgotten physical stock certificates gifted to you by Great Aunt Gertrude in 1972. If you have been lucky (and patient) enough to hold on to these physical stocks, kudos to you! But be forewarned: continuing to hold on to these may have “Headache” written all over it, especially for your executor and/or heirs.
How are your assets ‘passed on’?
In order to explain, let’s take a look at some basic estate planning. At your passing, all of your assets must be distributed. There are two ways to ‘pass on’ your assets. One is through what is known as ‘operation of law’, the most easily recognizable beneficiary designations. You most often see these on your retirement accounts and life insurance policies. Individual assets may also contain beneficiary designations (you can request your Individual brokerage account have Payable-On-Death or Transfer-On-Death designations). Bank accounts are increasingly offering these to their customers as well. Several states also allow for deeds to contain TOD designations. While it is outside the scope of this article to discuss the implications of establishing a Revocable Living Trust, having a properly funded one also avoids probate.
Read the full article on PBMares’ Wealth Management team’s website.