Has your plan kept up with your life?

Spring isn’t just a time for cleaning, it is also a good time to do all of the yearly maintenance tasks around your home.  Proper maintenance can save you money and protect your family.

But more than just your house needs maintenance.  You would be well advised to review your estate plan at the same time.

Many of your assets are controlled by beneficiary forms.  Typically, these will be your retirement accounts (such as IRAs, 401(a), 401(k), and 403(b) accounts), life insurance policies, and any other accounts you have with a transfer on death (TOD) or payable on death (POD) designation.

When your beneficiary forms don’t keep up with changes in your life, it can cost you — and the people you love — lots of money.

Have you, or someone you know, gone through any of these major life changes since you last checked your beneficiary forms:

  • Gotten married
  • Gotten divorced
  • Had a child
  • Lost a husband or wife

Many people automatically think to update their estate plan when they have one of these major life events.  But the beneficiary forms often slip through the cracks.

I have read several stories in the news recently about money from a retirement account or life insurance policy going to the wrong people because beneficiary forms weren’t updated.

  • If you have gotten divorced, is your ex-wife or ex-husband still the beneficiary of your life insurance?
  • If you have gotten married, are your parents or siblings still the beneficiaries on your accounts?

It can be tough to predict what life changes will make you rethink your beneficiary forms.  So put it on your calendar.  Every year, get a copy of all of your beneficiary designations and make sure they reflect the life you now lead.

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