Broker Check

Beneficiary Review

May 01, 2019

No detail is too small.  While naming a beneficiary can be as simple as listing the name of an individual or entity, it is often the most overlooked and neglected task in one's financial plan. The financial and administrative consequences of this oversight can be costly and very time consuming.

Beneficiary designations can come in many forms: life insurance policies, retirement accounts, trans-fer on death accounts, and Trusts all have beneficiary designations. Each of these designations carry their own list of pros and cons for tax planning and estate planning. Therefore, it is very important that individuals weigh their decisions carefully. After all, the objective of estate planning is not just to determine who gets what after an individual dies but to make sure that the deceased’s assets are transferred in the most efficient manner possible  by avoiding  unnecessary  tax  burdens and administrative delays. Often the beneficiary designation is one of the most valuable tools in making sure that an individual’s wishes and their legacy are preserved after their death.

It is important to review your beneficiary designations regularly to ensure they reflect your current wishes.  It is especially important to review your beneficiary designations after major life events such as a marriage, divorce, growing family, change in employment, or even a change in account custodians.  Beneficiary designations can be changed at any time so it is better to have something listed rather than neglect the beneficiary designation due to indecision. We also recommend consulting your estate planning attorney periodically to review your Trust beneficiaries to ensure your Trust is still consistent with your estate planning goals.