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Get it Together This Year: Why Consolidating Accounts is Important for Estate Planning

consolidating accounts

Would consolidating accounts help? Let’s see…you have a checking account at Big Bank of Florida, an old 401(k) retirement account at a Plantation Florida Big Bank, an investment account, a credit union account, and, oh yes, that separate online banking account your spouse knows nothing about…

And then… you keel over and die.

And no one knows where any of these accounts are. Or that they even exist.

While on the one hand it’s great that you have so many financial assets, on the other hand, having lots of accounts in several different places (i.e., at different banks, investment houses, and/or online banks) can not only interfere with your future financial success—it can wreak havoc with your estate when you die.

In today’s post we are going to talk about an estate planning concept that we tell our clients about that is frequently overlooked: why consolidating your accounts is important.

What is Consolidation?

Simply put, consolidation means combining all (or as many as possible) of your accounts into one main account.

This could mean consolidating accounts at various banks, or life insurance policies, or even investment accounts.

Why is Consolidating Accounts Important for Estate Planning?

In addition to the obvious fact that it is easier to manage various accounts if they are all in one place, consolidating accounts is important for estate planning.

Why?

Because having a lot of different accounts at numerous financial facilities can cause massive time and money headaches for your surviving relatives and/or your trustee if you have a Revocable Living Trust (“Trust”).

For example, if you have a number of different bank accounts in and around Florida or online and investment and/or retirement accounts when you die, your Personal Representative (whether designated by you in your Last Will and Testament (“Will”) or appointed by the court if you die intestate), must search for each one of these accounts and take all necessary steps to bring them into the probate estate, account for each of them, and make sure that each is properly administered and distributed.

If you have a Revocable Living Trust and not all of your accounts are in the trust, your trustee (or substitute trustee) must, among other things, locate all the accounts, contact the bank to find out if there is a named beneficiary on the account or not, keep track of any and all accounts that are not within the trust but do not have a named beneficiary, and determine which accounts should be delivered to the trust, and see to it that the transfers are properly made.

Regardless of whether it is a trustee or personal representative who is responsible for marshaling your estate’s assets, the point is that having numerous accounts scattered in different places makes the trustee’s or personal representative’s job that much harder.

Which costs your estate in terms of time and money —leaving less to distribute to your loved ones.

The best way to avoid all this is by consolidating accounts whenever possible.

Not only will this make your life less complicated,  but it will also most certainly make things easier for your children or spouse or whomever is charged with the responsibility of wrapping up your affairs when you are gone.

Talk to Our Estate Planning Attorneys 

Since 2011, SJF Law Group has been helping clients in Broward, Miami-Dade, and Palm Beach counties protect their families through estate planning, probate administration, and trust administration. Our law firm is pleased to offer both in-person and virtual appointments throughout the State of Florida, ensuring our services are accessible no matter where you are located. We pride ourselves on combining the personalized service and attention of a boutique law firm with the talent and legal acumen of a large firm. Our experienced estate planning attorneys work hard to ensure that your wishes will be followed, and your loved ones taken care of when you are gone.

If you want to discuss your specific situation with our experienced estate planning lawyers, please contact SJF Law Group at 954-580-3690. You can also fill out our contact form. We take pride in responding to inquiries in a timely manner.

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