Life can change fast, and your beneficiary designations need to keep up so your money actually goes where you intended.
Beneficiary designations on accounts like IRAs, 401(k)s, life insurance, and POD/TOD accounts generally override what is written in your will. That means an ex-spouse or estranged relative listed years ago could still receive those assets, even if your will says otherwise.
Because these transfers usually bypass probate, they are one of the most direct ways your wealth moves after you are gone. Keeping them current is a simple step that can prevent legal family disputes and family tension at an already stressful time.
Life Events that Should Trigger a Review
- Marriage or divorce, including remarriage and blended families.
- Birth or adoption of a child or grandchild.
- Death of a spouse, family member, or existing beneficiary.
- Changes in relationships or responsibilities, such as caring for an aging parent.
- Job changes or retirement that create new retirement plans or insurance policies.
Even without a big event, it is wise to review designations every few years to keep them aligned with your broader estate plan.
Practical Steps You Can Take
Start by making a list of all accounts and policies that have beneficiaries: employer plans, IRAs, annuities, life insurance, bank or brokerage accounts with TOD/POD instructions. Confirm both primary and contingent beneficiaries so there is a clear backup if someone predeceases you or denies the inheritance.
Next, coordinate beneficiary choices with your will, trusts, and tax strategy so everything works together. Working with a financial advisor and, when appropriate, an estate planning attorney can help you avoid common mistakes and ensure your legacy truly reflects your current wishes.
If you have any questions, reach out to Bruce Eisenhauer at Meikle Financial Group.
