We all know the feeling. You are hired at a new job and show up for your first day all scrubbed up and ready to work. Then you spend your first day – at least – filling out endless forms. You are suddenly faced with forms for insurance, retirement, pension, parking permits, sexual harassment policies, dress codes and codes of conduct.
Perhaps you diligently fill out each form in final by the end of that first day and properly turn it into HR. Perhaps not. If you fall within the latter category – as many of us do – please be sure that you DO NOT overlook any form that requires a so-called beneficiary designation. If an employee is married, then her spouse will automatically be listed as the beneficiary on any life insurance or retirement accounts. But, if the employee is not married or wishes to have a beneficiary other than her spouse, she must be sure to include that persons name as the beneficiary on all such forms.
Any assets with a beneficiary designation will pass to the beneficiary without the hassle, or expense, of going through the probate process. The intended beneficiary may avoid going to court and proving that the employee intended to leave the account to her.
Caution – your beneficiary designations trump your will. So if your current partner is listed as the beneficiary in your will but your life insurance designation still lists someone else (like your ex), guess who gets the insurance money? That’s right – your ex. A good rule of thumb is to check your designations every year during your open enrollment period.