In your will and on your various accounts, you have named who your heirs are and what they will receive. However, what would happen if you and at least one of your heirs were to die at the same time? It can happen in a car crash or other accident. There are some things you can do to account for this, and the law has also outlined what occurs in this instance.
If Your Spouse Is Living, Nothing Changes
If your spouse is still alive, they will inherit your estate. In this case, even if you and one of your children or other named heirs die at the same time, nothing major should change. The only exception to this is if you had your children as named beneficiaries on accounts that were in your name only.
Name Contingencies
One way of preparing for this situation is to name contingency beneficiaries and a contingency executor in your will. The individuals named as contingencies do not receive anything or do anything unless all of the other named beneficiaries or the named executor are dead. For example, if you have three children as your named life insurance beneficiaries and a cousin named as the contingency, all three of your children would have to die before the policy would pay the cousin. Likewise, your contingency executor will not need to perform any duties unless your named executor dies.
Include a Clause Covering This in Your Will
You can include language in your will that states exactly what is to occur with an heir’s inheritance should that heir die before you do. The easiest thing to do here is to state that their share is to be divided equally among the other heirs. You can also state that it is to pass to their children. If you have three children, You may state that they are to spilt your estate into thirds. If one dies, the other two would receive half each. However, if you state that your children’s children get their share, then your two living children would get a third and your deceased child’s children would split the other third.
Have questions or want to learn more? Contact Michael F. Kanzer & Associates today.