Have You Updated Your Beneficiary Designations?

  • Estate Planning
Have You Updated Your Beneficiary Designations? | Chicago Lawyer Mario Godoy | Estate and Probate Legal Group

If you’re like most of us, once you’ve created your will and estate plan you pat yourself on the back and enjoy peace of mind knowing you’ve taken care of and provided for the future of your loved ones. Proper estate planning is more than completing a will or setting up a trust fund. Failing to update your beneficiary designations could undo your best-laid plans.

What Are Beneficiary Designations?

When you start a new job with insurance benefits or take out a life insurance policy, you designate your beneficiary: the person who will receive the money or assets in the event of your death. Your beneficiary could be your spouse, your children or your parents. But when your life circumstances change, it’s important that you update your designated beneficiaries on all financial documents such as

  • Insurance policies
  • Wills and trusts
  • Bank accounts
  • Pension and retirement plans
  • Social security
  • Guardianships
  • IRAs
  • Stocks and bonds
  • Annuities

Any time you have an important life change, you should review and update your beneficiary designations:

  • Marriage or divorce
  • Birth of a child or grandchild
  • Death of a child, spouse, parent, sibling or dependent
  • Joining or leaving the military
  • Retirement
  • Children reaching legal age

Consequences to Not Naming a Beneficiary

If you do not name a beneficiary for an insurance policy, pension, or retirement plan, on your death benefits will likely be paid according to Illinois intestacy laws. Out of date beneficiary designations are a costly but preventable mistake. Illinois attorney Mario Godoy explains,

“Your beneficiary designation overrides your estate plan. It is the official document that determines how to distribute your assets.”

Beneficiary designations make the process of transferring assets after death faster and easier for everyone involved, and making a mistake can cause annoying and expensive problems that an attorney might not be able to fix. Avoid issues with your beneficiary designations in Lombard by contacting Estate & Probate Legal Group in Lombard Illinois today.