Is It Time to Rethink Your Beneficiaries?

  • Estate Planning
  • Illinois Probate Law
  • Trusts
  • Wills
Last Will and Testament: Is It Time to Rethink Your Beneficiaries? | Mario Godoy | Chicago Estate Planning Lawyer

Who will receive your assets if something happens to you? Your beneficiaries are the people you’ve said will receive your assets. Retirement accounts, bank accounts, life insurance policies, wills, trusts and other accounts all provide an opportunity to name your beneficiary. A will or trust may make your intentions clear as to what is to be done with your assets such as property, but other accounts such as pension plans, insurance policies, or forms of retirement income need also need a clear beneficiary. As a result, a person who does not keep track of these policies thay may have been established years earlier may need to rethink their beneficiaries or their wishes may not be met and their estate could incur unplanned expenses and take additional time to resolve.

Private Wealth Strategist Cindy Campbell says some beneficiary decisions need a second look and now is the time to rethink your beneficiaries:

7 Common Beneficiary Choices You May Need to Rethink

1. Leaving It Blank
If you leave the beneficiary spot blank, you are forcing your account to go into costly and time-consuming probate.

2. Naming Your Estate Your Beneficiary
If you do not name a specific person or charity as your beneficiary, you are forcing your estate to go through court-ordered probate.

3. Life Changes 
Review your account beneficiaries every 3-5 years. Marriage, death divorce and other life changes are a good time to review your beneficiaries.

4. Individual With Special Needs
You don’t want a beneficiary with special needs who received government benefits to become disqualified for those benefits due to an inheritance.

5. A Minor
Certain states disallow minors from a direct inheritance. The funds will need to be held in an account for their benefit. If a minor beneficiary comes of age, the child may inherit assets the grandparent wanted to be withheld until they are older.

6.  Addiction Issues
A beneficiary with addiction issues may need to have their funds managed by a 3rd party for their benefit.

7. International Beneficiaries 
If your beneficiary lives in another country, you need to be sure they are eligible to inherit both in the United States and their home country. You also need to consider the impact of taxes in both countries.

When to Rethink Beneficiaries

If it’s been more than 5 years since you last did a thorough review of your account beneficiaries, or if you’ve had significant life changes, now is the time to rethink your beneficiaries.

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 by contacting Estate & Probate Legal Group in Lombard Illinois today.