Your will controls only part of the distribution of your assets

In movies and other popular media, the will is often portrayed as being the ultimate determiner of what happens to someone's property after they die. Although this is true to a certain degree, other legal documents control many of your important assets. Because of this, it is important to know the basics of asset distribution when you are working on your estate plan.

Which assets does my will control?

In short, your will controls the assets that are subject to probate. During probate, the court examines your will and determines whether it is valid. If it is found to be valid, the court ensures that the assets subject to the probate process are distributed according to the terms of your will. During instances where the decedent did not have a will, the court will ensure that the probate assets subject to the law of Texas are distributed according to Texas' intestacy laws. These laws set the rules for asset distribution in cases where there was no will (or an invalid one).

So, what are probate assets? Generally, these assets include those titled in your name only. Aside from your personal belongings, probate assets include real property (not jointly owned with right of survivorship with someone else), investments, stocks, cars and motor vehicles, and individual bank accounts. After you die, your will (or the intestacy laws, if applicable) control how these assets are distributed.

Which assets are not controlled by my will?

Assets that do not need to pass through probate before they may be distributed are called non-probate assets. Simply put, non-probate assets are those that contain a beneficiary designation or that you jointly own with someone else. Common non-probate assets include:

• Life insurance

• Assets subject to a trust

• Bank accounts with payable-on-death or transfer-on-death designations

• Retirement assets

• Annuities or pensions

• Real property held with someone else with a right of survivorship

• Other assets with beneficiary designations

Even though the will may indicate otherwise, non-probate assets are distributed according to their beneficiary designations. Because of this rule, it is important for you to revise and update your beneficiaries following major life events, such as marriages, financial windfalls, divorces, births and deaths. Otherwise, certain non-probate assets may mistakenly go to an ex-spouse or someone who is dead, if your designations are not updated.

Unfortunately, estate planning is more complicated than writing a will and updating beneficiary designations. To avoid any potential problems, it is wise to check in with the experienced estate planning attorneys at Hayes & Wilson, PLLC following major changes in your life. Our attorneys can identify and implement any changes made necessary by the life event, ensuring that your assets are on track to be distributed according to your wishes.