Updating Beneficiary Designations – Why It’s so Important

When is the last time you updated your beneficiary designations? It’s amazing the amount of people who have prior spouses or deceased relatives still named as a beneficiary on a retirement account or on a life insurance policy.

This is why it is so important that after marriages, divorces, births, deaths and other major life events, you review, and if necessary, update your beneficiary designations.

 Tips about Beneficiaries

  • If you do not designate a primary beneficiary, the payment may pass to your estate where it could be subject to taxes and fees, or state law may determine who receives the benefits.
  • Be sure to list a secondary beneficiary in the event your primary beneficiary precedes you in death.
  • List the full name of each beneficiary instead of “son,” “spouse,” “wife,” etc. This will avoid complications down the line.
  • If you have more than one primary beneficiary – specify the percentage of proceeds each one should receive.
  • Listing specific beneficiaries will override your will. Make sure your wishes are covered in both documents.
  • Consider consulting an advisor (Investment professional, accountant, lawyer, etc.) if you have specific questions.

Human Resources does not keep copies of your retirement beneficiary designation form. If you are unsure of who you have currently named as your beneficiary(ies), complete another form.

Forms to update your state retirement and life insurance beneficiaries can be obtained from Human Resources. Dept. of Retirement beneficiary designations can be returned directly to the Dept. of Retirement. Life insurance beneficiary forms can be returned to Human Resources.