Should I name a backup beneficiary?

Question

I am updating my retirement accounts and life insurance and realized that I only listed primary beneficiaries. If the person I named dies before me and I never update the form, I am not sure where the money would go. Is naming a contingent or backup beneficiary important even when the primary beneficiary is young and healthy, and what happens when an account has no surviving beneficiary on file?

Soradin · Accepted Answer

A contingent beneficiary can receive the asset if the primary beneficiary dies first or cannot receive it. As part of the legal review, beneficiary designations usually control life insurance, retirement accounts, and payable on death accounts, even when a will says something different. As part of the legal review, forms should be reviewed after family changes and should include appropriate contingent beneficiaries. Keep copies with the rest of your important records, so the people who may need them know where they are located.

Should I name a backup beneficiary?

Soradin

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