Estate Planning and Designating Trusts

Hundreds of names, birthdays, anniversaries, appointments... from day to day, there’s much to remember. If a number of years have passed since you chose beneficiaries for your insurance or retirement plans, there’s a chance you have forgotten to update them as needed. Marriage, divorce, birth, death, or other changes can prompt the need to revise your beneficiary designations.

Review Estate Planning and Trusts

Even if you have been diligent about updating your will, trusts, and other important elements of your estate plan, remember also to make thoughtful and deliberate beneficiary designations - and to review them periodically. Life insurance and retirement plan beneficiaries take precedence over instructions in a will.

If your spouse is your primary beneficiary, pay close attention to any secondary designations. If your spouse predeceases you and no secondary beneficiary is named, the institution might be forced to cash out accounts and add them to your estate - which could trigger a costly combination of estate and income taxes.

Keeping beneficiary designations current can also help simplify life for surviving family members. For example, if you name your first two children as contingent beneficiaries but forget to add a third child from a later marriage, it may create complications later that your heirs are not prepared to handle.

Retirement accounts could grow to become one of your largest assets, so you might want to add a "beneficiary review" to your list of things to remember.

I contacted Immediate Annuities.com to buy one of my immediate annuities. They were prompt, very responsive, paid attention to detail, understood my objectives, and were superb when it came to staying on top of seeing the funds transfer and issue of new policy documents through to completion.

Dr. David Babbel Professor Wharton School

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Remember when Planning your Estate and Trusts

Distributions from traditional IRAs and most employer-sponsored retirement plans are taxed as ordinary income and, if taken prior to age 59 ½, may be subject to an additional 10 percent federal tax penalty.