Will versus beneficiary

[Mikekob]

What is the name of your state (only U.S. law)? Colorado

HI,

I have a question regarding the validity of a will versus beneficiary appointment on a life insurance account.

My grandmother passed away mid January. She had left a will that my aunt and two uncles an equal share of my grandmothers assets. My mother passed away about four years ago so she was not on the will that was shown to me. In the will it states the grandchildren are each to get 2,000 upon the sale of my grandmothers house.

There has been many questionable acts by my aunt who managed to change the will three days before my grandmothers passing, and was also able to somehow get one of my uncles name off all accounts without his consent which already makes me very hesitant to sign anything she asks.

Fast forward through a whole bunch of drama and I got a phone call from my Grandmas financial adviser. I was told my mother(deceased) was left on two accounts as a beneficiary. My aunt is making a stink and tried to get me to sign something that would essentially cause me to forfeit my portion of what my brother and I are to receive in place of my mother. I went to the financial planner and she said that since my mother was left on the paperwork legally my brother and I split what would have been her share. I was also told by the financial planner the Beneficiary appointments over rule the will. Is this the case and if so where would I find such law? Aside from a bunch of sketch moves already the financial planner said my aunt was furious and that she would take me to court if I kept the money. I have zero intent as to handing anything over because of her opinion.


Thanks!!!

Mike

 

[LdiJ]

What is the name of your state (only U.S. law)? Colorado

HI,

I have a question regarding the validity of a will versus beneficiary appointment on a life insurance account.

My grandmother passed away mid January. She had left a will that my aunt and two uncles an equal share of my grandmothers assets. My mother passed away about four years ago so she was not on the will that was shown to me. In the will it states the grandchildren are each to get 2,000 upon the sale of my grandmothers house.

There has been many questionable acts by my aunt who managed to change the will three days before my grandmothers passing, and was also able to somehow get one of my uncles name off all accounts without his consent which already makes me very hesitant to sign anything she asks.

Fast forward through a whole bunch of drama and I got a phone call from my Grandmas financial adviser. I was told my mother(deceased) was left on two accounts as a beneficiary. My aunt is making a stink and tried to get me to sign something that would essentially cause me to forfeit my portion of what my brother and I are to receive in place of my mother. I went to the financial planner and she said that since my mother was left on the paperwork legally my brother and I split what would have been her share. I was also told by the financial planner the Beneficiary appointments over rule the will. Is this the case and if so where would I find such law? Aside from a bunch of sketch moves already the financial planner said my aunt was furious and that she would take me to court if I kept the money. I have zero intent as to handing anything over because of her opinion.


Thanks!!!

Mike

Yes, a beneficiary designation overrides a will. The item in question passes to the beneficiaries outside of the estate and probate.

 

[anteater]

The real questions are:

1) Were you and your brother named as contingent beneficiaries on the life insurance policy?
2) If you weren't named as contingent beneficiaries, does the insurance policy contract provide that you and your brother would receive the proceeds if your mother predeceased your grandmother?

I would not take a financial planner's word that you receive the proceeds in place of your mother. I've seen "financial planners" that get so many estate- and inheritance-related concepts mixed up that your head would spin. Ask the financial planner the two questions above.

Of course, the one definite way to find out is to file a claim for the proceeds with the insurance company. Insurance companies are not in the habit of handing out money to the wrong people.

 

[LdiJ]

The real questions are:

1) Were you and your brother named as contingent beneficiaries on the life insurance policy?
2) If you weren't named as contingent beneficiaries, does the insurance policy contract provide that you and your brother would receive the proceeds if your mother predeceased your grandmother?

I would not take a financial planner's word that you receive the proceeds in place of your mother. I've seen "financial planners" that get so many estate- and inheritance-related concepts mixed up that your head would spin. Ask the financial planner the two questions above.

Of course, the one definite way to find out is to file a claim for the proceeds with the insurance company. Insurance companies are not in the habit of handing out money to the wrong people.

It doesn't sound like the two "accounts" in question are life insurance. It sounds like they are some other types of accounts.

 

[anteater]

It doesn't sound like the two "accounts" in question are life insurance. It sounds like they are some other types of accounts.

Maybe... But I was taking the OP at his/her word:

I have a question regarding the validity of a will versus beneficiary appointment on a life insurance account.

Still, the questions would be the same. Were OP and brother named as contingents? Did the account contract itself provide some sort of default contingent if the primary beneficiary is predeceased?

 

[Mikekob]

When I went to Edward Jones to get the paperwork left for me it was to receive money left for my brother and I. My mother was one of the four beneficiaries on the accounts. I know one or both were life insurance.

I look at it just like it was mentioned... An insurance company wouldn't just start cutting large checks to the wrong person. I would assume, which may be incorrect, that they have seen the will and all other paperwork and have deemed my brother and I the individuals who get the pay out.

 

[Mikekob]

My brother and I were not on the list of beneficiaries per the insurance but our mom was. I was told since she isn't here to collect it goes to my brother and I since she is deceased.

 

[anteater]

I would assume, which may be incorrect, that they have seen the will and all other paperwork and have deemed my brother and I the individuals who get the pay out.

Who is "they?"

The will is not relevant when there are beneficiaries named for specific accounts or life insurance policies. What is relevant is what the account or contract paperwork says.

It appears that you have done what I was going to recommend: take the money [and run].

That does not mean that your Aunt can't hoot, holler, and throw a fit. And/or attempt to get the court to order you and your brother to return the funds to the probate estate. That's the way of the legal system. If she is determined to do so, she gets a crack at persuading the court. With any luck, she will get sound legal advice before trying.

 

[anteater]

My brother and I were not on the list of beneficiaries per the insurance but our mom was. I was told since she isn't here to collect it goes to my brother and I since she is deceased.

First, "I was told" is one of the most dangerous people around. If you are asking questions on a message board, it is always best to be more specific about who did the telling. Doesn't have to be the name of a person. But, at least, something like the "Edward Jones broker" or the "life insurance company representative"...

Once again, if the insurance contract states that you and your brother take the proceeds if your Mother predeceased, then that is the way that it is.

 

[Mikekob]

My mother was the name listed on the paperwork stating she is a beneficiary. Since she is no longer alive to collect her portion my brother and I were taking her place.

Per my aunt who called me asking me to "get the check and sign it over to her", there was a "transfer upon death" paper that was supposed to take my mom out of any paper work. My aunt is now claiming the Edward Jones agent is incompetent and left my mom on two of the three accounts. This paper was the issue per my aunt and is now claiming regardless of the legal documents, this isn't what my grandma wanted. She also refused to give me the name of the lawyer she is working with so I can see the paperwork. She wants me to just hand over the money and she'll pay me any taxes at the end of the year. Hmmm

I just spoke with the financial planner at Edward Jones and she said My moms name was taken off one of the three accounts. Mom is on two and it clearly states if she passes there's a "per stirpes" clause that states the remaining children of my mom get her portion.

So looks to me like my aunt can go pound sand.

 

[justalayman]

Mikekob;3252712]My mother was the name listed on the paperwork stating she is a beneficiary. Since she is no longer alive to collect her portion my brother and I were taking her place.

that is not how beneficiaries of insurance policies and many other accounts with beneficiaries work. You would usually have to be named as a contingent beneficiary to be able to "take" of your mothers share.

I just spoke with the financial planner at Edward Jones and she said My moms name was taken off one of the three accounts. Mom is on two and it clearly states if she passes there's a "per stirpes" clause that states the remaining children of my mom get her portion.

there ya go. That is what was required for you to receive the money based on your mother being a beneficiary. Why didn't you just say so? Without that, you would not have received the money unless there was something else making you a contingent beneficiary. It would have gone elsewhere as directed by the policy terms or, if there were none, to the other beneficiaries or if none, to the estate of the decedent.

, there was a "transfer upon death" paper that was supposed to take my mom out of any paper work.

was there? I presume you have asked the investment counselor about such a possibility.

 

[anteater]

Mom is on two and it clearly states if she passes there's a "per stirpes" clause that states the remaining children of my mom get her portion.

So looks to me like my aunt can go pound sand.

To paraphrase JAL's response: Bingo, the two magic words - per stirpes.

I suggest that you and brother get your hands on the funds or establish separate accounts at ED Jones or whatever you wish to do. And then sit tight to see what your Aunt will do.

 

[Mikekob]

The transfer upon death was for a single account out of three she had. My aunt keeps saying it was supposed to b for all three but the paperwork is only for a single Edward Jones account.

So as I plan on getting the money would you recommend I hold it and not spend any of it? Seems to me like she doesn't have a foot to stand on due to the per stirpes and the fact that the companies are cutting us checks in the first place. Funny thing is I still have two thousand coming from what's in the will and it would be coming from her. I wouldn't be surprised if that never showed up though.

 

[ajkroy]

Deleted**************.

 

[justalayman]

Mikekob;3252806]The transfer upon death was for a single account out of three she had. My aunt keeps saying it was supposed to b for all three but the paperwork is only for a single Edward Jones account.

then it is what it is.

So as I plan on getting the money would you recommend I hold it and not spend any of it? Seems to me like she doesn't have a foot to stand on due to the per stirpes and the fact that the companies are cutting us checks in the first place. Funny thing is I still have two thousand coming from what's in the will and it would be coming from her. I wouldn't be surprised if that never showed up though.

If somebody is going to challenge the distribution, it is usually better to hold onto the money without spending it for a reasonable period of time. While it does not look like she has any claim, maybe there is something everybody is missing and she really has a right (on behalf of the estate), to the money.

as to what is coming to you:

be aware that no money can be distributed from the estate until the debts are paid. While a testator often intends on leaving money to an heir, things happen and the debts overwhelm them and there is no money in their estate to distribute to anybody. If there is money in the estate, then keep an eye on the proceedings. You can access the probate file as it is public and anybody can access it.