Stay current with your circumstances
If it’s been a while since you’ve revisited the beneficiaries on your insurance and retirement plans, it may be worth your time to have a look. While digging into financial records isn’t necessarily anyone’s idea of a good time, it can be even less of a good time for you if your beneficiaries are outdated or no longer appropriate.
Avoid a worst-case scenario
A recent article in Forbes illustrates the potential consequences of neglecting to keep up to date with beneficiary information. The author of this article had listed her father as the beneficiary of her IRA. Her kids grew up, her mother passed away, her father remarried. She never changed her beneficiary designation. If she had suddenly passed away before realizing her mistake, her IRA would have gone to her father, and then eventually to her father’s new wife, who would have no obligation to share the money with the author’s children.
Similarly, maybe you forgot to take your ex spouse off as a beneficiary for an account. Your ex spouse gets remarried, and has more children with the new partner. If you pass away without changing your beneficiary designation, your money would go to your ex, with the new spouse next in line. It’s possible your children might not see any of it. This is why it’s important to pay attention and stay on top of your accounts as your life changes.
It’s important to have your beneficiaries right, even if you’re not going through a divorce. It can help to consult with an estate planning lawyer and revisit your beneficiary designations as a part of a larger estate plan that incorporates all of your assets.
Disclaimer: The information in this blog post (“post”) is provided for general informational purposes only, and may not reflect the current law in your jurisdiction. No information contained in this post should be construed as legal advice from Sheehan Barnett Dean Pennington Little & Dexter, PSC or the individual author, nor is it intended to be a substitute for legal counsel on any subject matter. No reader of this post should act or refrain from acting on the basis of any information included in, or accessible through, this Post without seeking the appropriate legal or other professional advice on the particular facts and circumstances at issue from a lawyer licensed in the recipient’s state, country or other appropriate licensing jurisdiction.