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Dear Quentin,
My grandfather, 86, recently changed his will to specifically exclude my mother — his daughter — and leave everything to me.
If my mother has been listed as a beneficiary on any of his retirement accounts or life-insurance policies, does that go directly to my mother? Or me? Or both? Does a beneficiary supersede a will, or vice versa?
His current girlfriend, 80, has been listed as executrix, and in the event of her death, I will be executrix of his will. What could happen if this goes to court? How do I initiate having this uncomfortable conversation with my grandfather?
I want to address this before it’s too late.
Granddaughter in Texas
You can email The Moneyist with any financial and ethical questions related to coronavirus at qfottrell@marketwatch.com, and follow Quentin Fottrell on Twitter.
Dear Granddaughter,
If your grandfather would like to completely disinherit your mother — and she is listed as a joint owner on a bank account or the beneficiary on an IRA or life-insurance policy — he would need to take direct action. He could not remove your mother as a joint owner of an account without her consent, but he can change the beneficiary on retirement and life-insurance accounts relatively easily.
“They pass by beneficiary designation and are not controlled by a will,” according to Rania Combs Law. “The only time a will would control a non-probate asset is if no beneficiary is designated or the estate is named as the beneficiary. That’s why it’s so important to coordinate non-probate assets with the way your will disposes of your property.”
Of course, there are cases of a person forgetting to update their beneficiaries. As this Supreme Court case shows, citing state law, the children of the deceased were awarded the proceeds from a life-insurance policy even though the ex-wife was still listed as a beneficiary. Other times, couples agree to maintain beneficiary arrangements as part of their divorce agreement.
It’s up to your grandfather to make these changes. As a beneficiary of his estate, it seems imprudent to initiate a conversation with him about his other policies in order to ensure he removes your mother as beneficiary — and, presumably, includes your good self — unless you have some compelling reason such as elder abuse as a motivating factor.
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