Was working with a gentleman in my office today. He was signing all his important estate planning documents. When we met for the first time a couple weeks ago, we realized that his company 401(k) was his most valuable asset.
His 401(k) was worth around $600,000. His remaining assets total about $200,000 in value. In order to provide for the disposition of his $200,000 non 401(k) assets he has to hire a lawyer, take time away from his work and family, and pay hundreds or thousands of dollars to have legal documents prepared. This documents must be meticulously drafted, and when signed, he had to go through a "ceremony" declaring in the presence of a lawyer and two witnesses that it is his testament, and all the parties must sign statements to that effect.
After he signed all his estate planning documents, we realized that he needed to change his beneficiary designation on his 401(k). I slid my laptop across the table and he went on the T. Rowe Price website, and with a couple of clicks, he changed the beneficiaries of his 401(k) - no formalities, no witnesses, no signatures.
My question: "Why is it so cumbersome to provide for the disposition of non-retirement accounts, yet so easy to provide for the disposition of certain retirement accounts? Is it because government controls the rules regarding dispostions through Wills and Trusts, but company's that handle retirement accounts like 401(k)s and IRAs are given the freedom to make their own rules regarding the disposition of those types of accounts? What do you think?
Paul Rabalais
I also think the Designation on which you work has value than trust. Beneficiary designation always provide more depositions for your retirement.
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veny
http://www.addictionrecovery.net/louisiana
Posted by: veny dawson | July 16, 2008 at 12:55 AM