One of the most important parts of your estate plan is choosing who will get your assets when you die.
Here are answers to the most common questions regarding beneficiaries.
What is a Beneficiary?
A beneficiary is a person chosen as the recipient of funds or property under a will, trust, insurance policy, 401(k), etc.
For example, the beneficiary of a life insurance policy is the person who receives the payment of insurance after the death of the person that was insured.
What is a Primary Beneficiary?
A primary beneficiary is a person or entity that is first in line to inherit an asset. In the event the primary beneficiary dies, a secondary beneficiary is the next in line.
Who or What Can be a Beneficiary?
You are able to name the following as a beneficiary:
- One person
- Two or more people
- A trust, that is controlled by the appointed trustee
- A charity
- Your estate
Can I Change my Beneficiaries?
Yes, you are able to change your beneficiaries. While you are looking at the beneficiaries you have chosen, don’t forget to make changes to your beneficiaries as your life changes, for instance, marriage, divorce, birth of a child, adoption of a child, etc.
We hope this article assists you in choosing who will get your assets when you pass away. For additional information about beneficiaries and the estate planning process, request our free book, Do I Really Need a Will?