When it comes to estate planning, one of the best things you can do to ensure a smooth transition of control of your estate is to keep your beneficiary information up to date on all pertinent documents. Doing so will prevent confusion and delay in processing your estate. You can either choose to conduct a regular review to make certain that your beneficiary information is, indeed, correct, or you can simply change it any time you make changes to your beneficiaries.
Where might you have to update beneficiary information? Life insurance policies, trusts and retirement accounts are all examples of items which might require you to stipulate a beneficiary. Life changing moments such as marriage or the birth of a child should be cues to update this information accordingly.
How do you update your beneficiary information? This all depends on what you’re updating (insurance v. retirement accounts, for example) and the entity which manages that asset for you. For example, you may have a life insurance policy that requires you to submit an updated form to your insurance agent. Conversely, you might have a 401K that allows you to update beneficiary information over the internet by logging into your account. Even if you don’t have to update your beneficiary information now, it’s a great idea to make sure you know which steps must be taken in order to do so, so that the process can be more streamlined when it counts.
Remember: If you’re adding or removing someone as a beneficiary, communicate this to said person(s) if it’s possible to do so. This will save both your executor and your beneficiary(ies) confusion in the future.