Coping with the death of a spouse, child, or beloved family member can be an extremely stressful experience, especially when it comes to finances and the proper disposition of assets. Should something happen to you, are you positive that your assets you’ve spent years accumulating will pass to the correct person or entity?
NOW IS THE TIME TO REVIEW AND UPDATE YOUR BENEFICIARY DESIGNATIONS!
We all experience things in life that may make us second-guess decisions we’ve made in the past. Whether it’s marriage, divorce, birth of a child or grandchild, or even death of a spouse, it’s a good time to review and coordinate an estate plan with the help of an attorney or qualified financial advisor. This is the best practice to ensure that all your benefits will be properly disbursed according to your wishes and to prevent any delay in the distribution for your heirs. And, notably, an updated will alone may not carry out your wishes because beneficiary designations in other documents may supersede the instructions or specific requests in a will.
What if I don’t have named Beneficiaries?
If you have not completed and submitted designation of beneficiary forms, your benefits may be paid by legal order of precedence as follows:
1) Designated beneficiaries, if any
2) Current spouse
3) Surviving children in equal shares
4) Surviving parents in equal shares (not in-laws)
5) Executor/Executrix of estate
6) Next of kin pursuant to state law in which you live
*Some exceptions may apply to legal order of precedence (qualifying court order, assignment of rights, etc.).
Who can I name as a beneficiary?
In most cases, you can name any person or entity you deem appropriate as your beneficiary. You may also choose to divide your assets with multiple beneficiaries. Additionally, you have the option of naming contingent beneficiaries if something were to happen to you and a spouse at the same time or your intended beneficiaries predecease you. However, if you have a special needs individual that you wish to share in your benefits, be cautious electing him or her as a direct beneficiary. You could unintentionally disqualify that person from receiving valuable government benefits because any inheritance may place him or her over an income contingency eligibility threshold. As previously stated, it’s the best practice to always consult an attorney who specializes in probate estates to consider your options, especially if you have minor children.
Why should I review my beneficiary designations?
It’s extremely important to review your beneficiary designations periodically to ensure proper disposition of your assets. For example, if you designated your spouse as your beneficiary when you first signed up for FEGLI or TSP, but have since divorced and remarried without updating your beneficiary designations, your benefits may go to your former spouse even if your will instructs otherwise. Do NOT let this happen! Just imagine the tension and anxiety you may create, even if unintentionally.
Beneficiary designations are a vital part of estate planning, and should be reviewed and updated periodically to arrange for your wishes to be honored and help loved ones avoid future headaches. If you need assistance with estate planning, please consult an attorney or qualified financial advisor. For more benefits information, please consult your Human Resources Department. Designation forms are easily accessible on the J-Net Benefits Page.
Web References
· Thrift Savings Plan: www.tsp.gov
· OPM: www.opm.gov
· J-Net Benefits page – http://jnet.ao.dcn/human-resources/benefits
NOW IS THE TIME TO REVIEW AND UPDATE YOUR BENEFICIARY DESIGNATIONS!
We all experience things in life that may make us second-guess decisions we’ve made in the past. Whether it’s marriage, divorce, birth of a child or grandchild, or even death of a spouse, it’s a good time to review and coordinate an estate plan with the help of an attorney or qualified financial advisor. This is the best practice to ensure that all your benefits will be properly disbursed according to your wishes and to prevent any delay in the distribution for your heirs. And, notably, an updated will alone may not carry out your wishes because beneficiary designations in other documents may supersede the instructions or specific requests in a will.
What if I don’t have named Beneficiaries?
If you have not completed and submitted designation of beneficiary forms, your benefits may be paid by legal order of precedence as follows:
1) Designated beneficiaries, if any
2) Current spouse
3) Surviving children in equal shares
4) Surviving parents in equal shares (not in-laws)
5) Executor/Executrix of estate
6) Next of kin pursuant to state law in which you live
*Some exceptions may apply to legal order of precedence (qualifying court order, assignment of rights, etc.).
Who can I name as a beneficiary?
In most cases, you can name any person or entity you deem appropriate as your beneficiary. You may also choose to divide your assets with multiple beneficiaries. Additionally, you have the option of naming contingent beneficiaries if something were to happen to you and a spouse at the same time or your intended beneficiaries predecease you. However, if you have a special needs individual that you wish to share in your benefits, be cautious electing him or her as a direct beneficiary. You could unintentionally disqualify that person from receiving valuable government benefits because any inheritance may place him or her over an income contingency eligibility threshold. As previously stated, it’s the best practice to always consult an attorney who specializes in probate estates to consider your options, especially if you have minor children.
Why should I review my beneficiary designations?
It’s extremely important to review your beneficiary designations periodically to ensure proper disposition of your assets. For example, if you designated your spouse as your beneficiary when you first signed up for FEGLI or TSP, but have since divorced and remarried without updating your beneficiary designations, your benefits may go to your former spouse even if your will instructs otherwise. Do NOT let this happen! Just imagine the tension and anxiety you may create, even if unintentionally.
Beneficiary designations are a vital part of estate planning, and should be reviewed and updated periodically to arrange for your wishes to be honored and help loved ones avoid future headaches. If you need assistance with estate planning, please consult an attorney or qualified financial advisor. For more benefits information, please consult your Human Resources Department. Designation forms are easily accessible on the J-Net Benefits Page.
Web References
· Thrift Savings Plan: www.tsp.gov
· OPM: www.opm.gov
· J-Net Benefits page – http://jnet.ao.dcn/human-resources/benefits