How Do I Change a Beneficiary Designation with My Will or Trust?

Episode Transcript

Speaker 1 (00:31):
Well, good afternoon, Michiganers, and welcome to Tuesday with Tom,
Michigan's Only podcast where we talk about estate planning, a
state settlement, and everything in between. As always, I'm your host,
Tom Doyle, a state planning attorney, lifelong Michigan resident, and
ambassador for all things good in this great state of Michigan. Welcome,

(00:56):
Welcome to today's episode. Well, just a b recap of
the last episode Understanding Michigan Certificate of Law Trust. Many
of you might have a certificate of trust that was
prepared with your estate plan, or you might be dealing
with the title company you're selling real estate and they're

(01:18):
asking you for a certificate of trust and you're wondering
what that is and why it's important. Well, if you
have any questions about certificate of trust, I invite you
listen to our last episode. I discuss the legal requirements
for a certificate of trust and what they are used

(01:38):
for in the state of Michigan. Today's show, though, how
do I change a beneficiary designation with my will or trust?
A question that a man and I are frequently asked
when clients come in. They might have already put beneficiaries
on life insurance policies, they put beneficiars on bank accounts,

(02:00):
but beneficiaries on their retirement plans, et cetera. But now
they want to change those and they're wondering how can
they do that by either having a will or having
a trust. So that's what we're going to be talking
about today, how beneficiary designations work and how you can
change them with a will or trust. But please remember

(02:23):
what I'm about to discuss is, as always, for educational
purposes only. It is not intended to be legal advice.
As always, you need to work with you and your
attorney to determine what is appropriate for you and your
estate plan. So how do you change a beneficiary designation

(02:59):
with your will or your trust. Well, let's start with
identifying what it is we're actually talking about today. So
what's a will. Well, if you've attended one of our
seminars or you've listened to previous episodes of this program,
you'll know that a will is simply a legal document.
In that document, it talks about where you want your

(03:21):
estate to go to, who the de disease are, if
you will in your will, if you have mind your children.
You're going to be talking about who's going to raise
your children until they get to be eighteen. But that's
basically what a will is. It's a legal document. It
has to meet the requirements for properly prepared and executed
in the state of Michigan. And the other thing though

(03:44):
that you would know is that a will is a
meaningless document until a couple things die, a couple things happen.
I'm sorry, one is you die. So until you die,
the will is really a meaningless accumulation of paper, and
it is meaningless until a probated state is opened. But

(04:06):
once a probatea state is opened, then the will is
going to control all of the assets that you own
that are going to go through probate. Now, what's a trust. Well,
a trust is very much like a will in the
sense that it is a legal document. A trust is

(04:27):
normally used to provide how you want your state to
be disturbed at the time of your death, and you're
going to have a trustee, someone who's going to be
in charge of that. Those are basically the primary functions
of a trust. Now, one difference, major difference between having
a trust and having a will is that assets that

(04:48):
are in the trust don't go through probate, where assets
that are only going to be controlled by your will
are the only those assets that actually go through probate.
So think of a trust. Though I've talked about this
in previous episodes as though it's a box sitting in
front of you on the table as you're listening to
today's episode. The trust controls assets that you put in

(05:13):
the box, i e. Assets that are, as lawyers called it,
funded to your trust. So what's a beneficiary designation? Well,
beneficiary and there's a there's a different number of terms,
but they all essentially mean the same thing. It might
be a beneficiary, It might be a TOD which stands

(05:35):
for transfer on death. That might be a POD which
means payable on death, but the essentially all mean the
same thing. It's essentially a contract between you and a company.
It might be you and your bank. It might be
you and your life insurance company. It might be between
you and your financial management company. Whatever it is where

(05:57):
it's a written contract between you in the company. And
basically what that contract does is it spells out who
or where you want assets to go at the time
of your death. So use life insurance as an example.
You have a life insurance policy. You have a beneficiary

(06:18):
designation on your life insurance policy, and that life insurance
designation might indicate, for example, on upon your death, you
want your life insurance to go to your spouse. Well,
that's the contract between you and the life insurance company.
Or it might be a bank account between you and
your credit union, or you and your bank, et cetera.

(06:39):
But essentially, per that contract, upon your death, those assets
that are controlled by that contract are going to go
directly to the person that you wanted them to go to,
meaning what they do not go through probate. However, it
could be let's say that person that you designated as

(07:01):
a beneficiary dies before you and you haven't named an
alternate to that person, and then in that case the
assets are still actually going to go through probate. But
the idea is you've got a contract, you're looking to
avoid probate, and you're saying, I want these assets to
go directly to this person upon my death. Well, with

(07:25):
that as our explanation today, then let's think about assets.
Let's look at the situation where you have a beneficiary
on your bank account and you say, hey, can I
change the beneficiary on my bank account by having a
will or having a trust, or maybe you've got a

(07:50):
beneficiary on your annuity and you're looking and saying, can
I how can I change that beneficiary? So all of
these different things where you have been beneficiaries on them,
bank accounts, annuities, life insurance, I raise for one k's.
All of those assets where you've got beneficiaries on them,

(08:12):
you're looking in saying how do I change them with
my will or my trust? Well, if you keep in
mind that the will is only going to affect assets
that go through probate, and the beneficiary assets the assets
that you have beneficiaries on avoid probate, the answer is

(08:35):
you can't change that. Of course, amand and I would

(16:28):
be honored to If you've got questions about your beneficiary
designations and how they fit into your state plan, we'd
be happy to help discuss that with you, or creating
a state plan for you if you don't already have one,
or perhaps updating the state plan that you already have,
or guide you through the entire estate settlement process if

(16:50):
you're looking at settling and a state and we're trying
to make it easy as we can to get started.
If you simply go to our website DOYLELOWPC dot com.
There you're going to find information on how to schedule
appointments with us. It can be a virtual consultation that
will be via zoom or phone wherever you happen to

(17:13):
be in the state of Michigan, or we offer in
person appointments both in Ground Rapids and Lancing, So if
you live in the Grand Rapids area or the Lancing area,
you will be able to schedule a consultation through the website.
Reminder two, if perhaps all you need is one document,

(17:33):
let's say maybe you're just looking at having a new
healthcare power returnity created for you, Well check out the
legal store again available at Doyle LAWPC dot com, and
there you're going to see that you have the ability
to order just individual documents as well that can be
prepared and emailed to you for execution. Again, all of

(17:57):
that and more information is available at DOYLELAWPC dot com. Well,
that's a wrap, as they say, for today's show. As always, Oh,

(18:18):
if you have a comment about the program, a question
you'd like answered, or a topic that you'd like me
to cover in future episodes, head over to Tuesday with
Tom dot com. You can leave me a voice message
by clicking on the microphone or just send me an
email that would be Tom at Tuesday with Tom dot
com and be sure to follow us on Facebook. Invite

(18:41):
your family and friends to do the same at Tuesday
with Tom and follow the office as well, which would
be Doyle LOPC. And don't forget subscribe to our email list.
You can do that at Tuesday with Tom dot com
or DOYLELAPC either location, where we will keep you updated
on things that are happening with the program and other

(19:03):
estate planning tips. And remember too, you can listen to
Tuesday with Tom wherever you enjoy your podcast run many
many different services such as Apple Podcasts, Spotify, Amazon Radio,
Google Podcast, iHeartRadio, and Speaker and if you have a
smart speaker you can always ask your smart speaker to

(19:26):
play Tuesday with Tom as well. Well. Thanks again for
spending part of your day with us today and until
the next time, take care, stay safe, and have an
awesome day and an awesome week here in Michigan. Tuesday

(19:54):
with Tom has been brought to you by the estate
planning attorneys at Doyle Law PC to learn how we
can help you with your estate plan or with settling
a loved one's estate, Please call us today at five
one seven three two three seven three sixty six. That's
five one seven, three two three seven three sixty six