Getting your legal affairs in order can save your family a lot of headaches. Unfortunately, when creating a will, many people confuse the terminology. The situation can become particularly complicated if you have a large estate or wish to designate multiple beneficiaries. There are several types of beneficiaries, and determining the best options for your will can become confusing. To help you understand the terminology, we’ll explain what a residuary beneficiary is and how your estate divides.
Residuary Beneficiary vs Specific Gifts
Before we talk about beneficiaries, we first need to cover some basics regarding wills and trusts. If you want to determine who gets your property when you pass away, you must create a will. One of the first steps in outlining your will is selecting your primary and alternate beneficiaries. As the name states, a beneficiary is someone who stands to inherit a part of your estate after your passing.
You can dedicate (bequest) specific gifts or sums of money to individual beneficiaries or organizations. This type of beneficiary is called a non-residuary beneficiary. Specific gifts are common in wills regarding jewelry, property or family heirlooms or any specific asset you want someone to inherit. However, you may also choose not to name inheritors for specific gifts. In that case, you can leave everything to a residuary beneficiary.
A residuary beneficiary is sometimes also called a primary beneficiary. The person, persons, or organization you name as residuary beneficiaries can receive all or part of your estate. Of course, they won’t receive any specific gifts you have intended for others. If you have carefully detailed who gets what, there is no fear of mix-ups when you have passed. Residuary beneficiaries will receive all of your property in the percentages that you designate to each one. They can receive the property you didn’t name to someone specifically and the property that no one survived to inherit.
The Benefits of Naming Someone a Residuary Beneficiary
What If You Are Someone’s Residuary Beneficiary?
When someone passes, the will they created will go through a probate process. This represents the legal process of proving a will valid. You can hire a probate lawyer to make this process easier and faster. However, it would be best if you remembered that it could take a very long time before you receive anything. Even after the will has been read, it may even take up to a year.
Unfortunately, the person executing the will doesn’t even have to consult with you or update you on the process. This can lead to confusion, and sometimes even legal disputes can occur. If someone does file for a dispute, you can expect the process to take even longer.
However, if you feel the executor of the will is not moving the case forward, or being honorable, you can take legal action. Even threatening to take them to court should get your case moving. Nonetheless, we recommend being realistic with your expectations.
How to Name a Residuary Beneficiary
If you want to create a will, you should take your time and carefully plan everything out. We have created a handy checklist for creating a last will that you can use. By going through our checklist, you’ll ensure that you don’t forget anything important. The U.S. Will Registry has made creating a will easy and affordable. Its free and user friendly and will guide you through an easy questionnaire to make it seamless.
Best of all, you can name primary and secondary beneficiaries as part of your will. This is a much better option than letting the court decide what happens to your estate. However, to be safe that there is no confusion, you should be very specific when naming your beneficiaries. Use their full names and explain their relation to you. If you name more than one residuary beneficiary, then you should prepare to specify what shares you want each to receive.
In Summary
Remember that registration of a will is an essential step when planning your estate. Registering your will ensures that your beneficiaries will find it and receive what you intended.
