by Michael Cocco, CFP®, AXA Advisors
The simple answer is this: If you want the right people to get your money, you’ll need to keep your beneficiary designations up-to-date, even if your will or estate plan already is. That’s because a beneficiary form will override whatever you’ve said in your will or estate plan.
If you’ve got a bank, brokerage or retirement account, annuity or life insurance policy, you’ve probably filled out a beneficiary designation form. Most of the time, we fill them out then forget about them. Years pass. Then, when changes happen in our lives – we get married, divorced, lose a spouse, gain a child or grandchild – we might remember to update our will, but oftentimes forget about all of those beneficiary forms.
That’s where things can get a bit sticky. Not updating those forms could force future generations to pay too much in taxes, not receive their rightful inheritance, or could lead to other unfortunate consequences.
Here’s an overview of what could happen, depending on who you name as beneficiary:
Make updating beneficiaries a part of your financial review Consider adding updating beneficiaries to the list of things to go over during your annual review with your financial professional. Or, at the very least, update all of your beneficiary forms after you experience a life-changing event, such as marriage, divorce, birth or death of a loved one, as well as when you change jobs or retire, since any time you roll over a retirement plan, you’ll need to assign a new beneficiary.
Ready to update your beneficiary forms, but not sure who to name?
Contact your financial professional for help to ensure that your financial accounts and contracts are set up correctly and will benefit the people you want.
Michael Cocco is a certified financial planner with AXA Advisors in Nutley. He may be reached at email@example.com or (973) 667-8650.
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Please be advised that this document is not intended as legal or tax advice. Accordingly, any tax information provided by this document is not intended or written to be used, and cannot be used, by any taxpayer for the purpose of avoiding penalties that may be imposed on the taxpayer. The tax information was written to support the promotion or marketing of the transaction(s) or matter(s) addressed and you should seek advice based on your particular circumstances from an independent tax advisor. AXA Advisors, LLC and AXA Network, LLC do not provide tax advice or legal advice. GE- 102542 (04/15)(Exp.04/17)