The fact is some of your most valuable assets are governed by other laws that override any instructions you may have written in your will or trusts, or state laws of intestate succession if you do not have a will. In this case, the rule on who inherits the property is managed by contract law, not your will. For example:
- If you own life insurance or annuities, when you die the proceeds will pass by contract to a living named beneficiary or beneficiaries you designated when you purchased the life insurance policy.
- If you own 401(k), IRA or Roth IRA retirement accounts, when you die these assets also automatically pass by contract to the living named beneficiary or beneficiaries designated on the beneficiary forms. This person now owns the asset. Surviving spouses have certain rights to retirement accounts that cannot be given away without their permission.
- If you own real property with another individual as joint tenants with right of survivorship, the law generally grants automatic inheritance rights to the surviving joint tenants.
Each of these is an example of instances in which the manner in which the assets are titled govern how they are distributed upon your death. Upon your death, the assets pass automatically to someone else. These assets do not exist in your estate and are not subject to your will or probate.