Cover Your Bases…..Add Beneficiaries

We all think, and most likely will, live to a ripe old age.  However, one never knows for sure, so it’s best to prepare for anything. You should also talk to a close relative or friend about what your thoughts and wishes are regarding your final wishes. This can be a hard, yet necessary subject to bring up, however, it should really be discussed so someone will know and do their best to see that your wishes are fulfilled

Your money is hard earned, and you were disciplined and savvy enough to handle it properly.  It will be there for you, but should the unexpected happen, you want to be sure it doesn’t sit in limbo for years because no one you would have wanted to pass it on to even knows it’s there.  Or worse, the person(s) you’d least want to have it knows and goes after it.  In some, if not all states, if there are no beneficiaries listed, the state has the final say regarding any monies according to, and in a certain order, the next of kin: parents, siblings and so on.  It may be, but maybe not be what you’d want.  So, while you can, make those choices yourself.  It’s easy….and wise…and free.

None of your personal information regarding your account(s) is given or known to your beneficiary.

You need to put a beneficiary or beneficiaries on everything…some banks use the term payable on death (POD).  Adding beneficiaries will give you peace of mind knowing that when you do pass on, whatever is left, will go directly to someone of your choice.  Each time you open an account add beneficiaries.  You would need their name, date of birth, city where they live, and sometimes their Social Security number. Sometimes you need to tell their relationship to you (parent, sibling, child etc). If you haven’t already done this, it can be added, or changed, at any time. There is no cost to do this.

There are two beneficiary categories:  Primary (first) and Contingent (second).  You can change your beneficiary selections at any time and should check them over every so often as there are always life changes….. marriage, divorce, birth, death.  You want to update and change the beneficiaries at those times…..either adding or subtracting as the circumstance warrants.

There will always be one primary, but you can choose all as primaries.  The account will be shared equally, or divided as you chose – in percentages – all totaling up to 100%.  Or, you can split them into the two categories. Those listed as primary would receive the account as stipulated.  However, if they have died, the account is now divided by the contingents.

There are other documents that should be drawn up to cover any and all circumstances that may arise where you cannot make legal or financial decisions for yourself.  This is called Estate Planning…. to have them done gives you the assurance that you have made choices yourself.  And it relieves those left behind from the task to choose for you, and although doing their best, may choose differently for you.