Check your Beneficiary Designations

Stick this chore under the heading “As adult as adulting can get.” You’re doing great at adulting if you have a retirement plan, life insurance, investments accounts, bank accounts, and the like. Checking the beneficiaries periodically is part of the package, though, so if you haven’t done it in a few years, it’s time.

Circumstances change, and even if you think you know who you named as beneficiaries, you’d be surprised how many folks check and find out its someone they forgot they had named, or thought they had already changed. If your retirement plans (401(k)s, 403(b)s, or IRAs, etc) are held or managed through your employer, they can probably help you find your designations. If they can’t find your designations, contact the company (or agency, if it is a state sponsored plan) and ask.

While your plans will go to your probate estate if there are no beneficiary designations or if they cannot be located, this is a more cumbersome and expensive process than having a beneficiary designation. There can also be unfavorable tax implications if the account passes through a probate estate, so it is worth the time to make sure you have and update beneficiaries. And while you’re at it, make sure you get a copy of the designation page to keep with your will so that your representative will have an easier time taking care of things.

Life insurance polices may also need to have beneficiaries updated periodically. A payout to a named beneficiary is typically much faster than having a policy distributed through your estate.

And finally, call your banks and check for beneficiary designations on all your accounts. It is fairly common for the paperwork provided upon opening an account to include a question about beneficiaries, and many people don’t even remember that they did this when opening their accounts. So take a look and make any updates needed.

If you need to do estate planning, or update a plan you did a while ago, we can help. To find out more, contact us at 833-RED-BOOT (833-733-2668) or legal@parkercounsel.com