Beneficiary Designations
A beneficiary is the person, or people, you choose to receive your assets. Beneficiary designations override conflicting instructions in a Last Will and Testament for those assets.
Beneficiary Designations
When preparing your estate plan, it is important to review and confirm your beneficiary designations to ensure your wishes are carried out as intended. Keeping these designations current can help protect the assets you have worked hard to build and provide financial support for your loved ones after your death. For that reason, it is essential to make sure your beneficiary information is accurate and up to date on all applicable accounts.
The following accounts have a Beneficiary Designation:
Retirement Accounts
- 401k
- Traditional IRA
- Roth IRA
- Simple IRA
- SEP IRA
Education Accounts
- 529 / ABLE Plan
- Coverdell Account
- UGMA Account
- UTMA Account
Other Accounts
- Life Insurance Policy
- Tax-Deferred Annuities
- Trusts
- Cash, Investment and Security Accounts
This list will help ensure that you have considered all ways that your assets can pass, aside from your Last Will and Testament.
Who Should You Consider When Choosing a Beneficiary?
When choosing a beneficiary, you can consider family members, close friends, and/or a charity or non-profit. However, certain accounts may have special considerations when naming a minor, charity, or non-profit entity.
In all cases, you should avoid naming a minor child directly as a beneficiary, since minors are not legally permitted to receive assets outright. Doing so can force the assets into a court-supervised guardianship until the child turns 18, delaying access and adding legal expense. Instead, consider naming a trust or a custodial account on the child’s behalf so the assets are managed and distributed according to your wishes.
Keep your designations current
Schedule a consultation with our Pennsylvania estate planning and elder law attorneys today.
