A beneficiary designation is a form naming who should receive a particular asset when you die — commonly used for financial accounts such as retirement accounts and life insurance, and in some states available for other assets, such as vehicles or real estate. Assets with a beneficiary designation generally don't pass through your Will — they go to the person named on the form. Common examples include:
- Retirement accounts, such as a 401(k) or IRA
- Life insurance policies
- Pay-on-Death and Transfer-on-Death accounts (often bank or brokerage accounts).
For these, whoever is named on the account's beneficiary form usually receives the money — even if a Will says something different. Because of that, it's worth keeping those forms up to date:
1. Contact each provider — your bank, brokerage, insurer, or retirement plan.
2. Check who you've named, and update anything that's no longer right.
3. Review them again after big life changes, such as a marriage, divorce, birth, or death.
One more thing worth knowing: in some states, spousal or community-property rules can affect who is entitled to these accounts, regardless of the form.
If you have questions about your beneficiary designations or how they fit with your Will, you may wish to consult an estate planning attorney in your state.
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