The Name Game
Financial Planning (02/03) Vol. 14, No. 13 p.53; Rattiner, Jeffrey H.

Naming a beneficiary for retirement accounts and life insurance policies is a critical part of the planning process, according to financial planners. The success or failure to update beneficiary forms can lead to serious problems down the road. For example, if the designation of a beneficiary is vague or in any way unclear, the insurance company may not be able to make payments because it cannot find the beneficiary. The execution of an estate plan can also go awry if conflicting information appears on the policy. What is more, contesting the orders of an estate plan is difficult to do once beneficiaries have been named and the policyholder has died. If the policyholder has a last-minute change of heart and names a different beneficiary in the will but does not amend the estate plan to reflect those changes, the person named in the estate plan will often supercede the beneficiary named in the will.


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