Here’s a little fact that you may not realize: when you assign a beneficiary for your IRA account, you are effectively bypassing any outside action against that account, including your will – assuming that the beneficiary assigned is appropriate. 

Photo by ConsciousVision

For most assets that you own, when you pass away, your last will and testament determines who will receive the assets. You may want to make sure that your daughter gets the heirloom china set, and your son receives the antique car, among other things – so you direct these wishes through your will.

If you don’t have a will, your state of residence, through the probate process, determines how your assets are distributed. Generally this will direct your estate to your living heirs in order, from your surviving spouse to your children and then grandchildren. It’s different in each state, so it really makes a lot of sense to get to know the rules in your state. It makes even more sense to set up at least a simple will to make sure everything is distributed per your wishes.

Back to the point: Your IRA does not go through the direction of your will or the probate process, as long as you’ve properly assigned a beneficiary or a group of beneficiaries. (These beneficiaries must also generally still be living at the time of your death.) The great thing about this is, since the assignment is cut-and-dried (i.e., beneficiaries are named specifically, so there are no questions), your heirs can immediately, upon your passing, access the funds in the IRA account if the need should arise. See the article here to find out more about proper choices for beneficiaries of an IRA.