Are You Doing Enough to Protect Your Estate from Being Turned Over to the State?
It has become apparent that states are becoming more aggressive in claiming mutual fund investments as “abandoned” property. While it is clearly in their financial interest to do so, it is not in yours. It is important to get sound legal advice in order to protect your assets and your heirs.
There are a number of ways to safeguard your investments and to prevent your financial accounts from being designated as “abandoned.” These include:
- Notifying any financial institutions you deal with of any changes to your profile, such as change of name, address, or ownership due to marriage, death or divorce
- Always notifying the U.S. Postal Service of any change of address
- Cashing all dividend or insurance benefit checks, even seemingly insignificant ones
- Making sure to initiate some transactions annually so accounts remain active
- Making telephone or Internet contact with each financial institution at least once every 3 years
- Making a current list of all assets and financial accounts available to a family member or adviser
- Making a periodic free search of relevant unclaimed-property websites
It is important to remember that automated deposits or withdrawal from an account are not regarded as “contact.”
The Investment Company Institute, a mutual fund industry trade group, is being proactive in alerting individual shareholders to the dangers inherent in the laws governing unclaimed property, and plans to disseminate this information through social media as well.
Laws concerning the point at which property can be deemed unclaimed or abandoned vary state to state. What they have in common is that they require evidence that there has been no client contact or activity for a certain period of time, generally three years. In some states, an account may be considered “abandoned” even if mail has been delivered to a valid address during the intervening time as long as it has been substantiated that there has been no client contact.
The laws surrounding estate planning and the protection of assets can be complicated. If you have any questions or concerns, please contact OC Wills & Trust Attorneys and speak to one of our knowledgeable lawyers. We serve clients in Irvine, California and throughout Orange County and can be reached at 949.347.5256.