Update the Naming of Your Beneficiaries

Question: What do the following financial assets have in common: IRAs, 401(k)s, life insurance, annuities, and "in trust for" and "pay on death" accounts (with banks, brokers, mutual funds)?

Answer: Each lets you name one or more people to inherit from you (beneficiaries) when you die -- without going through probate.

Question: What happens to such a financial asset if you outlive your named beneficiaries?

Answer: This has the same effect as if you had not named beneficiaries in the first place. The asset would be distributed as provided in your will. If you have no will, distribution would be made under the formula created by the State Legislature (in California, a "next of kin" approach). Depending on the dollar value of the assets involved, a probate may be required.

Reminder: Things change -- relationships change, needs change, financial situations change, people die -- any of these events can cause a change in your thinking about your beneficiaries.

Recommendation: Track down those dusty old beneficiary forms, and check the names of your beneficiaries. Go ahead, get them together and check them now -- and make changes as needed. Also, set an automatic time each year (examples: April 15, or your birthday) to check and update your naming. While you're at it, check to see that any will or trust is up to date also.