| When it comes time to name the beneficiary for your | | | | directly. While you may have a will or a trust in place |
| life insurance and retirement accounts, there are a few | | | | leaving all of your assets to person A, if your |
| factors that should definitely be considered. If these | | | | retirement account lists person B as the beneficiary, |
| forms are not filled out correctly, your wishes may not | | | | person B will receive the assets. Be sure you check |
| be carried out, or your heirs may be left with a | | | | your beneficiary paperwork regularly to ensure your |
| significant and avoidable tax consequence. Here are a | | | | assets are set up to go where you want them. |
| few tips on how to choose your beneficiary. | | | | 3.) Minors Should Not Be Beneficiaries- Most |
| 1.) Retirement Accounts- If you are married and have | | | | custodians will not distribute assets to a minor. Since |
| taken the steps to put a Living Trust in place, DO NOT | | | | this is the case, you may want to set up a trust |
| name your trust as the primary beneficiary on your | | | | naming your children a the beneficiary, and list the trust |
| retirement accounts. This is a costly mistake that is | | | | as the beneficiary on your account. Another option is |
| made time and time again. If your trust is the primary | | | | to name the person you have listed as caregiver to |
| beneficiary, rather than your spouse, 100% of your | | | | your children. Whatever approach you choose, be |
| retirement account will need to be liquidated to fund | | | | sure to name a non-minor beneficiary. |
| the trust. This means you will be forced to pay income | | | | 4.) Name Contingent Beneficiaries- A contingent |
| taxes on 100% of the retirement account all in one | | | | beneficiary is the person who will be named as |
| year rather than taking distributions as you need them. | | | | beneficiary if the primary beneficiary predeceases you. |
| 2.) Directly Appoint Your Beneficiary- Many don't | | | | Each of these tips should be carefully considered to |
| realize that both your Life Insurance and Retirement | | | | ensure your assets are distributed as you see fit. |
| Accounts require you to appoint your beneficiary | | | | |