Who Should Be Your Contingent Beneficiary?

Who should I put as contingent beneficiary?

Although it’s more common for contingent beneficiaries to be immediate family members, close friends and other relatives are often listed as well.

Multiple contingent beneficiaries may be listed on a life insurance policy or retirement account..

Can a trust be a contingent beneficiary?

Contingent Beneficiary. A living trust can have both primary beneficiaries and contingent beneficiaries. This is true both for a single-grantor trust and a joint living trust, a common option for spouses as it allows for multiple grantors.

How old does someone have to be to be a beneficiary?

18 years oldThe children will receive the money and interest when they are 18 years old (in Alberta). Minor beneficiary trusts allow you to control at what age your children will come into both the income from your estate and the capital itself.

Does beneficiary override spouse?

Under ERISA, if the owner of a retirement account is married when he or she dies, his or her spouse is automatically entitled to receive 50 percent of the money, regardless of what the beneficiary designation says. … A spouse can forgo his or her right to 50 percent of the account by properly executing a Spousal Waiver.

Should my child be a contingent beneficiary?

Name your child as a contingent beneficiary Most people choose their spouse as their primary beneficiary, so if you’re trying to keep the money in the family then you might want to name your child as the contingent beneficiary.

Is a contingent beneficiary the same as a secondary beneficiary?

A secondary beneficiary, also known as a contingent beneficiary, is a person or entity that inherits assets under a will, trust, or account (e.g., insurance policy or annuity) when the primary beneficiary dies before the grantor.

What happens to a 401k if you die?

When a person dies, his or her 401k becomes part of his or her taxable estate. … “As the named beneficiary of the plan, you should be able to access the money even while the rest of the estate is in probate,” said Fred Mutter, tax manager at Deloitte and Touche.

Is a contingent beneficiary required?

A contingent beneficiary isn’t always required for financial accounts and insurance policies. But it’s highly recommended, not just for your own peace of mind but to take away what would become a lot of unnecessary stress for your family.

Can I name my girlfriend as a beneficiary?

Besides naming a spouse as beneficiary, a policyholder could choose another family member, such as an adult child, a business partner, or even a boyfriend or girlfriend outside the marriage. … Insurance companies don’t make moral judgments about who is named as beneficiary.

Is a spouse automatically the beneficiary of a 401k?

If you are married, federal law says your spouse* is automatically the beneficiary of your 401k or other pension plan, period. You should still fill out the beneficiary form with your spouse’s name, for the record. If you want to name a beneficiary who is someone other than your spouse, your spouse must sign a waiver.

Can the same person be a primary and contingent beneficiary?

There can be multiple primary and contingent beneficiaries, but contingent beneficiaries only receive their benefits in the event that none of the primary beneficiaries survive the account holder.

Who you should never name as your beneficiary?

Whom should I not name as beneficiary? Minors, disabled people and, in certain cases, your estate or spouse. Avoid leaving assets to minors outright. If you do, a court will appoint someone to look after the funds, a cumbersome and often expensive process.

What happens to my TSP if I die?

A beneficiary who is not a surviving spouse cannot retain a TSP account. The death benefit payment will be made directly to the beneficiary or to an “inherited” IRA. … If a beneficiary participant dies, the new beneficiary(ies) cannot continue to maintain the account in the TSP.

What happens if there is no contingent beneficiary?

What Happens If There Is No Contingent Beneficiary? If the primary beneficiary is dead, can’t be found, or refuses the asset, and there is no contingent beneficiary, then the asset goes into your general estate and will need to go through probate. If you have a will, the asset will go to those designated in the will.

Can a beneficiary be anyone?

Your beneficiary can be a person, a charity, a trust, or your estate. Almost any person can be named as a beneficiary, although your state of residence or the provider of your benefits may restrict who you can name as a beneficiary. Make sure you research your state’s laws before naming your beneficiary.