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Retirement Account Beneficiary Forms

If you’ve every filled out an IRA, Pension Plan, 401(k) plan, or other retirement plan form, you realize the complexity that is involved in the process. But don’t allow the complexity to distract you from one very important question that affects your estate planning in a major way.

One section of the form asks who you’d like to name as beneficiaries of your retirement plan should you not receive the benefits.

Such estate planning is handled via contract (the application form) and is not subject to probate should you die without a will. The retirement benefits do not enter probate because you are not technically the holder of the assets. The bank, pension fund, or other fund holds the assets and appropriates them to you when the time comes. Should you be unable to collect the benefits, the bank or fund will pay the named beneficiaries.

Many forms require that you state the beneficiaries name, address, social security number, relationship to you, and percent of benefits received. Whether you name one beneficiary or more, the total percent received should always equal 100%.

Most retirement forms will also require you to list primary beneficiaries and contingent beneficiaries. The primary beneficiaries are people who will receive the benefits. The contingent beneficiaries are “back-ups” in case one of the primary beneficiaries are unable to receive the benefits.

Just as you would update your will or estate plan after a divorce, remarriage, spouse’s death, or other change in your family, so you should update your retirement beneficiary information. Updating is necessary so that upon your death, the benefits will pass to the person to which you intend.

If you would like more information concerning your estate planning options, www.EstatePlanningSpecialists.com is a comprehensive online resource for personal wealth management solutions through wills and revocable trusts. Whether your estate planning goals are immediate or long-term, a California certified estate planning specialist will be able to counsel you on the best options available to you to meet your individual needs.

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