Friedman Group
  • About Us
    • Careers
    • Privacy
  • Services
    • Business
    • Employee Benefits >
      • Share To Compare
    • Financial Services
    • Personal
    • Specialty Insurance
  • AP Blog
  • Pay Online
  • Contact
  • About Us
    • Careers
    • Privacy
  • Services
    • Business
    • Employee Benefits >
      • Share To Compare
    • Financial Services
    • Personal
    • Specialty Insurance
  • AP Blog
  • Pay Online
  • Contact

Welcome to The Friedman Blog

Review your designated beneficiaries annually

8/19/2019

 
Update your designated beneficiary
When you apply for life insurance or open a retirement account, you'll be asked to name beneficiaries. This is an important step in financial planning.
What's a named beneficiary?

A named beneficiary is the party who gets the life insurance death benefit, and/or the proceeds from an annuity or another financial account when you pass away. Generally, these should be individuals that you identify by name.

Why are beneficiaries important?

It's crucial to list your beneficiaries by name so that the money can go to these loved ones right away after you are gone.

When you don't name a beneficiary, money in the account will typically go to your estate. This means it will go through probate - an expensive process that can potentially take months or even years to complete. Your family and loved ones will only get what's left, after months of waiting.

What are contingent beneficiaries?

There are two kinds of beneficiaries - primary and contingent. A contingent beneficiary is the individual or entity who receives the money if the primary named beneficiary cannot.

Naming a contingent beneficiary is crucial because it helps protect your family against the unexpected.

For example: What if you and your primary beneficiary were to die in the same car crash? If you have no contingent beneficiary, the assets will fall back into your estate. Your surviving children or grandchildren would not be able to inherit the money until after a lengthy probate process.

What is an accidental disinheritance?

Suppose you had an estranged child, but also a loving and devoted stepchild who was very much a part of your life to the end? Unless you take steps to name the stepchild as a contingent beneficiary on your financial accounts or provide for your stepchild by name in your will, the probate attorneys must divide your assets according to your state's "intestate laws."

These laws are a set of defaults that govern who will receive your assets if you die without a will. They don't account for unadopted stepchildren.

Note: Beneficiary listings trump wills. If you have one person listed to receive your IRA assets or your life insurance proceeds in your will, and a different person listed as a beneficiary, the beneficiary listing will take precedence.
 
What to do now

It's a good idea to physically look at all your financial accounts every year, and update both primary and contingent beneficiary listings. If you can answer "yes" to any of the following questions, you may need to update your accounts:
  • Have you married or divorced in the last year?
  • Does a divorce decree or property settlement agreement specify you have to name anyone in particular as a life insurance beneficiary?
  • Have there been any deaths among your current beneficiaries?
  • Do you have any stepchildren who need to be added?
  • Do amounts need to be adjusted?
  • Do you have children from a prior marriage? Do you want to keep them as beneficiaries?
  • Have any new children or grandchildren been born? If so, what share should they receive?
  • Are your current beneficiaries competent to receive the assets directly? Or should the assets go to a trustee or guardian?

​A periodic review of all your beneficiary designations is an essential step in the financial planning process. Don't wait until it's too late.

Comments are closed.

    Categories

    All
    Compliance
    COVID 19
    Cyber
    Employee Benefits
    Personal Insurance
    Property Casualty
    Risk Management
    Wellness
    Workers Compensation

    Archives

    September 2022
    August 2022
    July 2022
    June 2022
    May 2022
    April 2022
    March 2022
    February 2022
    January 2022
    December 2021
    November 2021
    October 2021
    September 2021
    August 2021
    July 2021
    June 2021
    May 2021
    April 2021
    March 2021
    February 2021
    January 2021
    December 2020
    November 2020
    October 2020
    September 2020
    August 2020
    July 2020
    June 2020
    May 2020
    April 2020
    March 2020
    February 2020
    January 2020
    December 2019
    November 2019
    October 2019
    September 2019
    August 2019
    July 2019
    June 2019
    May 2019
    April 2019
    March 2019
    February 2019
    January 2019
    December 2018
    November 2018
    October 2018
    September 2018
    August 2018

The Friedman Group
501 Bell St.
Dubuque, IA 52001
Phone: (563) 556-0272
Home
Business Insurance
Employee Benefits
Personal Insurance
Financial Services
Contact

AssuredPartners
An AssuredPartners Agency
In February 2020, The Friedman Group joined AssuredPartners, the 11th largest insurance brokerage in the U.S. This partnership provides us access to additional capital and a national footprint that enables us to continue to negotiate the most favorable coverage terms and conditions for our clients, and allows us to provide an even broader spectrum of risk management support services. ​
© 2022 The Friedman Group, Inc.  Privacy Policy.