Ensuring Your Legacy - Part II

In last month’s newsletter, we suggested reviewing and updating beneficiary designations due to 2020 changes in the SECURE Act regarding IRA distributions. This month, we want to broaden the discussion and focus on other considerations important for ensuring your wealth is transferred in accordance with your wishes.

Financial planning has many goals. Transferring wealth from one generation to the next is an essential one. Changes in life circumstance always merit a beneficiary review. For example, have you married recently? Purchased a home or had a new baby? Have you made a career change, gone through a divorce, or lost a loved one? Making beneficiary reviews an annual part of your financial planning process allows you to stay on top of your designations and make desired updates in a timely manner.

It’s necessary to name a primary and a contingent beneficiary for each annuity policy, bank or brokerage account, life insurance policy and retirement account you may have. 

The primary beneficiary will inherit the asset when you pass away unless he or she precedes you in death. In this instance, the contingent beneficiary inherits the asset. Designating primary and contingent beneficiaries makes certain your assets go to your intended recipients when you pass away. 

It’s important to note that a beneficiary designation overrides any distribution instructions you may have in your will. Naming beneficiaries is also the easiest way to avoid probate. 

There’s another reason to review beneficiaries annually: Preventing mistakes. Having incomplete beneficiary forms is an example of a common mistake, as is improper titling of the inherited account. These and other mistakes are easily avoidable – and easily corrected during the review process. When they are not corrected, they may inadvertently lead to a contested estate. 

We look forward to working with you to review and update your beneficiaries and your overall financial plan. In the upper-right of this newsletter, we’ve included a link to Oppenheimer’s guide, “Conducting a Beneficiary Review.” The guide will give you an overview of the topics we would like to discuss with you as a part of a comprehensive, annual review of your financial plan.

When you are ready, feel free to contact Suzanne Rismiller at suzanne.rismiller@opco.com or call 800-231-7509.