February Topic of the Month: The Importance of Beneficiaries on All Accounts

Kevin Orsinger |

An account beneficiary, is a person named by you that is legally entitled to your assets should you pass away, serves an extremely important role on all out our accounts—bank, insurance, brokerage, retirement, and so on. However, many times in the rush to open an account, adding a beneficiary may have been forgotten, or postponed until a more convenient time. We make sure to add a beneficiary to an account like a life insurance account, but it is important to assign a beneficiary to other accounts as well. The beneficiary takes precedent over what is in your will, so it is important to always make sure your beneficiaries are up to date in the way you would like your resources allotted.

When you name a beneficiary, you ensure that your assets go to the individuals or organizations you intend. Without a clearly named beneficiary, however, your assets can be tied up by the state and they will follow specific laws in asset distribution. These laws may not align with your wants and values. Adding a beneficiary, or beneficiaries, can also ease the process of distributing your assets for your loved ones. For example, if you want to give each of your children a percentage of your asset and your spouse a larger percent, having multiple beneficiaries would allow that process to happen more seamlessly than relying on your spouse to divvy up the remainder.

This is especially important for young professionals. Often, when someone gets their first job, they make certain financial choices without thoughtful consideration, or might plan to add something later. But it is hard to find the “right” time to sit down and figure out all those details. It is important to make that decision whenever you open an account, get your affairs in order, and to update your beneficiary whenever needed. You will also want to consider naming a contingent beneficiary—one who will serve as beneficiary should the primary beneficiary pass away.

Naming beneficiaries costs nothing, takes a few moments of your time, can save you money on probate costs, is faster than probate, and ensures that your last wishes are met. Many accounts can and should have beneficiaries and keeping track of all of them can feel complicated. Call Orsinger Investment Group, Inc. at (724) 588-9067 to schedule an appointment to review your accounts and beneficiaries today!