Probably not, but it certainly wouldn’t hurt to have one
anyway.
Also, the funds in your account may not transfer to the people
you think should receive that money. You should check your account agreement
and ask your bank to answer any questions about where your funds will go once
you have passed away.
When you die, your will can only distribute the assets that
you, yourself, own. Your account agreement contains provisions that govern the
extent to which any funds held in a particular bank account actually belong to
you – as opposed to any other people who are also “account holders” or
“authorized users,” or whatever language your financial institution may employ
these days.
There are an elaborate number of different types of bank
accounts - joint accounts, multi-party accounts, pay on death accounts,
accounts held for the benefit of one person by another person (sometimes called
a “trust account”), convenience accounts, accounts with rights of survivorship
– the list can be confusing and I have found that most people don’t really know
what type of bank accounts they actually have. In fact, most have never read
their account agreement and didn’t keep a copy for their records.
Most likely, your account agreement also contains a
“beneficiary” designation. You probably filled this out (or left it blank) on
the day that you opened your bank account without even thinking about it. That
named “beneficiary” is contractually entitled to receive the remaining funds in
your account, directly from your financial institution, even if your will
says something different.
Basically, your last will and testament only transfers
property that has not been dealt with through a separate agreement signed
during your lifetime. Property such as life insurance proceeds, bank accounts,
investment accounts, and similar funds almost always have a “beneficiary
designation” that dictates who will receive those funds after your death,
whether or not your will has been admitted to probate.
Always, always, always read the fine print when dealing with
a financial institution, keep a copy of your account agreements, and
double-check your beneficiary designations.
By: Cynthia W. Veidt, cindy@lpvlaw.com
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