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Trust Beneficiary Designation

Avoid Family Strife — Discuss Beneficiary Designations

Few things can split a family down the middle more than disputes over who gets what from a recently deceased family member. You can help avoid strife in your family by keeping your will and your beneficiary designations updated and discussing with loved ones how you want your assets distributed.

Ensuring Your Property Is Distributed Correctly 

An up-to-date will is an important first step in ensuring that the property you want your loved ones to receive actually passes to them. However, a will alone can't control how all property is distributed. Life insurance policies, retirement plan accounts, and certain other assets may allow you to designate a beneficiary. Here are some specifics.

Retirement plan accounts. If you are married, you are generally required to name your spouse as the primary beneficiary of your qualified plan account unless your spouse signs the required type of consent waiving his or her rights to your plan assets. Just be sure to update your beneficiary designation whenever there has been a major life event, such as marriage, divorce, or the death of a named beneficiary. For example, if you name your spouse as beneficiary of your retirement plan and later divorce that spouse, he or she may still be entitled to receive your retirement plan assets when you die if you fail to change your beneficiary designation.

Life insurance proceeds. When you first buy a life insurance policy, you name a beneficiary or beneficiaries to receive the proceeds upon your death. The proceeds of your life insurance policies will generally be paid to the beneficiary or beneficiaries designated in your policy, even if you purport to name someone else as beneficiary of the policy in your will.

Other assets. Other assets also may pass through beneficiary designations. For example, you may be able to designate a beneficiary to exercise any stock options you may have within a certain time after your death. And if you bought company stock through an employee stock purchase plan, you may be able to designate a beneficiary for that stock.

A regular review of your will and your beneficiary designations can help maintain family peace and harmony.

Feel free to reach out to BECU Trust Services with any questions, or to schedule a complimentary consultation: (206) 812-5176 or email becutrust@becu.org.

Copyright © 2015 by NPI
BECU Trust Services is a trade name used by MEMBERS® Trust Company under license from BECU. Trust services are provided by MEMBERS® Trust Company, a federal thrift regulated by the Office of the Comptroller of the Currency. This is for informational purposes only and is not intended to provide legal or tax advice regarding your situation. For legal or tax advice, please consult your attorney and/or accountant. Trust products not federally insured, not subject to credit union or affiliate guarantee, and may lose value.