In drafting a will, a California resident may wonder whether all assets and belongings are covered by the document. In some cases, an individual might choose to clarify designations already included in assets such as life insurance policies and retirement plans. In other cases, there might be a concern about whether articles held in joint tenancy should still be listed in a will. It is helpful to recognize that only assets titled in one’s own name at the time of death are typically covered by the directions set forth in the will.
Assets such as retirement plans and life insurance policies typically include a beneficiary designation that stipulates how funds will be distributed upon one’s death. Securities or brokerage accounts are also dispensed based on transfer on death instructions. Even if these are listed in a will, the proceeds will be distributed according to designations made with the company managing these assets. Similarly, assets that are held jointly with a right of survivorship will be distributed to the remaining joint tenants regardless of any indications in a will. This is similarly true of community property held by married couples or domestic partners. Additionally, one’s will may not prescribe the distribution of a partner’s portion of community property.
Assets that are included in a living trust are managed according to the instructions contained in the trust document. Wills cannot counter these directions. In a revocable living trust, the testator typically serves as the trustee until becoming incapacitated or until death, at which point a successor named in the trust takes responsibility for managing the assets in the trust.
Although much of one’s estate may not be affected by a will, it may be important to have a will in place in case of unexpected changes such as the death of a beneficiary or the receipt of an unexpected asset. A lawyer may help in wording a will to express one’s wishes in case of such unexpected circumstances.
Source: The State Bar of California, “2. Does a Will Cover Everything I Own?“, October 17, 2014