ARE YOUR BENEFICIARY DESIGNATIONS UP-TO-DATE? Your will is not the only thing that will transfer your assets to your heirs upon your death. Certain types of your assets are transferred directly to heirs through a beneficiary designation. A beneficiary designation is a legal form where you name the person who will receive the assets upon your death. Beneficiary designation will override provisions you make in your will! Assets that pass by beneficiary designation include: - Insurance (life, accidental death and dismemberment, etc.
- Retirement pans (IRAs, 401(k) plans, Keoghs, etc.)
- Certain annuities
- Brokerage accounts with transfer on death (TOD) designations
- Payable on death (POD) accounts (Certain Trusts)
It's important to review and update your beneficiary designations when you experience a significant life event such as marriage, divorce, birth, adoption or death; when tax law changes; or when there is a change in your overall financial situation. Why? Because outdated beneficiary designations (deceased parents, ex-spouses, etc.) could misdirect the flow of your entire estate plan, resulting in unintended heirs and/or negative tax consequences. If you haven't reviewed your beneficiary designations in a while, now may be a good time to do so. Call me and I'll set up an appointment with our in-house Tax Attorney to make sure that your plans are in tune with your goals! - Phil Shoemake |
