When you look around your holiday table this year, you will probably not be thinking about the beneficiary designations on your 401(k), IRAs or life insurance policies. But perhaps you should.
Having the wrong beneficiary designated on these and other things like bank accounts, annuities and 529 college savings plans is probably one of the biggest estate planning goofs people make. This is because most of us name those beneficiaries when we initiate a plan or open an account and then forget about them.
However, life changes and this is why you need to review and update your beneficiary designations at least once a year. For example, here are six scenarios that could cause a change in beneficiary designation:
- You got married, divorced or remarried
- You changed jobs and moved your retirement account
- One of your beneficiaries died
- The birth of a child or grandchild
- You moved your account to another financial institution
- One of your beneficiaries became disabled
Not having the correct beneficiary designated (or designating a minor) can wreak havoc on your family when something happens to you as well as create tax issues for your heirs. You could unintentionally disinherit the very people you care the most about and potentially tie up your estate in probate or, worse, litigation.
Enjoy your holiday with family, and after the holidays are over, make it a point to review your beneficiary designations and update, if necessary.
If you don’t already have an estate plan – or have one that needs to be reviewed and updated – make 2014 the year you get this done.
As a Personal Family Lawyer®, I can further advise you on all your options and make things as easy as possible for your family during a Family Wealth Planning Session. If you would like to have a talk about estate planning for your family, call our office today to schedule a time for us to sit down and talk.
To your family’s health, wealth and happiness!
David Feakes
P.S. Want to get started on the most important planning you’ll ever do for your family? Give our office a call at (978) 263-6900 to get started. You’ll be so glad you did.
David Feakes is the owner of The Parents Estate Planning Law Firm, PC – a law firm for families in the Acton, Massachusetts area. David helps parents protect the people they love the most. If you would like to receive David’s exclusive, free report, “Six Major Mistakes To Avoid When Choosing An Estate Planning Attorney,” you can get it right here.
The Parents Estate Planning Law Firm, PC
