Who Gets This Money When You Die?

You may have more money connected to your name than you realize.

Think about:

💼 Your 401(k)

📈 Your IRA

💰 An old retirement account from a previous employer

📊 Stocks and investment accounts

🛡️ Life insurance through your employer

❤️ A personal life-insurance policy

Some people spend years building these accounts but haven't looked at the beneficiary information since the account was opened.

That's a problem you may be able to fix TODAY.

For many of these assets, one of the most important estate-planning decisions you make isn't written in your will.

It's the name listed beside:

BENEFICIARY

❤️ WHAT IS A BENEFICIARY?

A beneficiary is the person or entity you designate to receive an asset or benefit after your death.

Depending on the account or policy, you may be asked to name:

PRIMARY BENEFICIARY

This is your first choice to receive the asset.

CONTINGENT BENEFICIARY

This is generally the backup person or entity who receives the asset if the primary beneficiary cannot receive it.

🚨 Don't stop after naming only a primary beneficiary.

Ask whether the account allows you to name a contingent beneficiary too.

💡 WHY IS THIS SO IMPORTANT?

Imagine this:

You opened a retirement account 20 years ago.

At the time, you listed someone as your beneficiary.

Since then you may have:

💍 Gotten married

💔 Gotten divorced

👶 Had children

👶 Had grandchildren

⚰️ Lost someone

🤝 Had relationships change

🏢 Changed employers

📈 Rolled retirement accounts over

💰 Opened new investment accounts

But did you ever go back and check the beneficiary?

Don't assume.

VERIFY IT.

💼 START WITH YOUR 401(k)

If you currently work or previously worked for an employer that offered a retirement plan, find out what you have.

That could include:

💼 401(k)

💼 403(b)

💼 457 plan

💼 Pension

💼 Profit-sharing plan

💼 Other employer retirement benefits

Ask:

Who is currently listed as my beneficiary?

Do I have a contingent beneficiary?

Does my spouse have special rights under this plan?

What do I need to do if I want to change my beneficiary?

👩❤️👨 MARRIED? PAY SPECIAL ATTENTION TO RETIREMENT PLANS

Do not assume you can simply log into every employer retirement account and replace your spouse with another beneficiary.

Some employer-sponsored retirement plans have special federal protections for spouses.

Depending on the plan, a married participant may need the spouse's written consent before naming someone else as beneficiary.

That's why our rule here is:

🟢 Check the account yourself.

🟢 Ask questions yourself.

🟢 Update information yourself when the plan allows it.

🟡 Follow the plan's exact requirements.

🔴 Do not try to work around spousal-consent requirements.

Your employer or plan administrator can tell you what applies to your particular plan.

💰 WHAT ABOUT AN IRA?

An IRA is an Individual Retirement Arrangement.

Examples include:

📈 Traditional IRA

📈 Roth IRA

📈 SEP IRA

📈 SIMPLE IRA

IRAs also allow beneficiary designations, but don't assume the rules are exactly the same as your employer's 401(k).

Contact the company holding the IRA and ask:

“Who is currently listed as my beneficiary?”

“Do I have a contingent beneficiary?”

“How do I update my beneficiary designation?”

Then follow that institution's procedure.

⚠️ DON'T ASSUME YOUR WILL CONTROLS YOUR RETIREMENT ACCOUNT

This is one of the biggest lessons in this entire estate-planning resource.

If an account has a valid beneficiary designation, don't assume that writing something different in your will automatically changes the beneficiary designation.

Review BOTH:

📜 Your will

AND

❤️ Your beneficiary designations

Your estate plan should work together.

📊 WHAT ABOUT STOCKS & INVESTMENT ACCOUNTS?

Don't forget investment accounts.

You may have:

📈 Individual stocks

📈 Mutual funds

📈 Brokerage accounts

📈 Bonds

📈 Cash-management accounts

📈 Other investment assets

Contact your brokerage or financial institution and ask:

“Does this account have a beneficiary or Transfer-on-Death designation?”

If yes:

“Who is currently listed?”

“Do I have a contingent beneficiary?”

“How do I change it if necessary?”

Again — don't guess.

Your brokerage can tell you how your particular account is registered and what beneficiary options it provides.

🛡️ LIFE INSURANCE

Life insurance deserves special attention.

The entire purpose of life insurance is generally to provide a death benefit when the insured person dies.

But someone has to be entitled to receive that benefit.

Check BOTH:

Primary Beneficiary

and

Contingent Beneficiary

📝 SIMPLE EXAMPLE

Suppose Robert has a $250,000 life-insurance policy.

Robert names his wife, Angela, as his primary beneficiary.

He also names his two adult children as contingent beneficiaries.

If Angela survives Robert, the policy would generally be handled according to the primary beneficiary designation.

If Angela dies before Robert and Robert never changes the policy, the contingent beneficiary designation may become extremely important.

This is why you need a backup plan.

🏢 DON'T FORGET EMPLOYER LIFE INSURANCE

You may have life insurance through your job and not think about it very often.

Check it.

Ask your employer's benefits department or log into your benefits portal.

Verify:

☐ Do I currently have life insurance?

☐ How much coverage do I have?

☐ Who is the beneficiary?

☐ Is there a contingent beneficiary?

☐ Does the coverage continue if I leave this employer?

☐ Do I have any supplemental life insurance?

Don't assume your personal life-insurance beneficiary and your employer life-insurance beneficiary are automatically the same.

They may be completely separate policies.

💔 DIVORCED? CHECK EVERYTHING

This deserves special attention.

If you've been divorced, review:

💼 Retirement accounts

📈 IRAs

📊 Investment accounts

🛡️ Life insurance

🏦 Bank accounts

📜 Your will

🏠 Property documents

Don't simply assume:

“We're divorced, so my ex is automatically removed from everything.”

Different assets can be governed by different laws, plan documents, court orders and beneficiary rules.

A divorce decree or Qualified Domestic Relations Order (QDRO) can also affect certain retirement benefits.

After divorce, verify every beneficiary directly.

Do not rely on assumptions.

⚠️ WHAT IF MY BENEFICIARY DIES BEFORE ME?

This is why contingent beneficiaries are important.

If your named beneficiary dies and you never update your account, what happens next can depend on:

📄 The beneficiary form

📋 The plan or policy terms

⚖️ Applicable law

👥 Whether other beneficiaries were named

📜 Whether a contingent beneficiary exists

Don't leave this question unanswered.

If one of your beneficiaries has died:

Review the account now.

👶 SHOULD I NAME MY MINOR CHILD DIRECTLY?

STOP before automatically doing this.

Leaving money directly to a minor can create additional legal and financial issues because a young child generally cannot simply take control of a large financial account or insurance payout.

If you want money protected for a minor child, this may involve planning tools such as:

📜 A trust

👤 A properly designated custodian

💰 Other arrangements appropriate to the particular asset

🔴 THIS IS AN AREA WHERE PROFESSIONAL ADVICE MAY BE VERY HELPFUL.

The goal isn't simply:

“Make sure my child gets the money.”

The bigger question is:

“Who manages this money for my child, and when does my child get control of it?”

♿ SPECIAL-NEEDS BENEFICIARIES

Be especially careful if someone you want to provide for receives—or may someday receive—needs-based government benefits.

Giving assets directly to that person can have consequences that need to be considered.

🔴 DON'T GUESS HERE.

An attorney experienced with special-needs estate planning can help determine whether a special-needs trust or another arrangement is appropriate.

🟢 CAN I DO THIS MYSELF?

YES — much of the REVIEW process can be done yourself.

This is another excellent “DO IT TODAY” estate-planning task.

You can:

☐ Log into your retirement accounts

☐ Contact your employer's benefits department

☐ Contact your IRA custodian

☐ Log into your brokerage account

☐ Contact your life-insurance company

☐ Verify your beneficiaries

☐ Verify contingent beneficiaries

☐ Ask how to make changes

☐ Complete the institution's required beneficiary forms

You don't necessarily need an attorney just to find out who your beneficiary is.

Start there.

🟡 DO BENEFICIARY FORMS NEED TO BE NOTARIZED?

Don't automatically get anything notarized.

The retirement plan, brokerage, insurance company or financial institution determines the procedures and documentation required for its beneficiary designation.

Some retirement-plan changes involving a spouse can have additional consent requirements.

Follow the institution's instructions exactly.

Do not create your own beneficiary document and assume it replaces the designation maintained by the company.

🔵 DO I FILE THESE BENEFICIARY FORMS AT THE COURTHOUSE?

Generally, beneficiary changes for these accounts and policies are handled through the:

🏢 Employer or plan administrator

📈 Retirement-account custodian

📊 Brokerage company

🛡️ Insurance company

They aren't ordinarily something you take to your county courthouse simply because you're doing estate planning.

Keep confirmation of your beneficiary changes with your important records.

🔴 WHEN SHOULD I GET PROFESSIONAL HELP?

Consider an estate-planning attorney, tax professional or financial professional when:

⚠️ You have substantial retirement or investment assets

⚠️ You have a blended family

⚠️ You want to provide for minor children

⚠️ A beneficiary has special needs

⚠️ You want to use a trust

⚠️ Your spouse isn't the person you want to receive an employer retirement plan

⚠️ You're divorced and aren't sure what rights an ex-spouse has

⚠️ A QDRO or divorce decree affects the account

⚠️ You're naming your estate as beneficiary

⚠️ You're considering naming a trust as beneficiary of a retirement account

⚠️ You don't understand the tax consequences for your beneficiaries

⚠️ Your beneficiary designations don't match your overall estate plan

Remember:

You don't necessarily need an attorney to review your accounts.

You can do that part yourself TODAY.

Then, if you uncover something complicated, you know exactly what you need professional help with.

📋 BENEFICIARY REVIEW WORKSHEET

ACCOUNT/POLICY #1

Company:

Type:

☐ 401(k)
☐ IRA
☐ Pension
☐ Brokerage
☐ Life Insurance
☐ Other

Primary Beneficiary:

Contingent Beneficiary:

Date Verified:

Needs Updating?

☐ Yes
☐ No

ACCOUNT/POLICY #2

Company:

Type:

Primary Beneficiary:

Contingent Beneficiary:

Date Verified:

Needs Updating?

☐ Yes
☐ No

ACCOUNT/POLICY #3

Company:

Type:

Primary Beneficiary:

Contingent Beneficiary:

Date Verified:

Needs Updating?

☐ Yes
☐ No

📞 WHAT DO I SAY WHEN I CALL?

Keep it simple:

“I'm reviewing my estate-planning information and I want to verify my current beneficiary designation. Can you tell me who is listed as my primary and contingent beneficiaries and what I need to do if I want to make a change?”

For an employer retirement plan, also ask:

“Are there any spousal-consent requirements for changing my beneficiary?”

That's it.

You don't have to know all of the legal terminology before making the call.

💰 IMPORTANT: INHERITING A RETIREMENT ACCOUNT CAN HAVE TAX CONSEQUENCES

Receiving a retirement account isn't necessarily the same as receiving ordinary cash.

Federal tax rules determine how inherited retirement accounts are handled.

A surviving spouse may have options that aren't available to other beneficiaries.

Many non-spouse beneficiaries are subject to rules requiring an inherited retirement account to be distributed within a particular period.

Don't cash out an inherited retirement account simply because you receive access to it.

Before making a major withdrawal or rollover decision, find out the tax consequences and available options.

This is an excellent time to involve a qualified tax or financial professional.

📂 CREATE YOUR MASTER BENEFICIARY LIST

Keep a secure record showing:

Account/Policy

Company

Primary Beneficiary

Contingent Beneficiary

Date Last Verified

You don't need to include passwords or other sensitive access information on an unsecured list.

Review this list regularly and after major life changes.

⏰ YOUR “DO IT THIS WEEK” CHECKLIST

☐ Check my 401(k)

☐ Check old employer retirement plans

☐ Check my IRA(s)

☐ Check investment/brokerage accounts

☐ Check personal life insurance

☐ Check employer life insurance

☐ Verify every primary beneficiary

☐ Add/verify contingent beneficiaries where appropriate

☐ Update outdated information

☐ Ask about spousal requirements where applicable

☐ Save confirmation of any changes

☐ Update my master beneficiary list

Don't just read this checklist.

Pick one account and start.

❤️ THE BIG LESSON

Estate planning isn't only about creating legal documents.

Sometimes it's simply making sure the information already attached to your assets still reflects what you actually want.

You could spend money creating a beautiful estate plan and still leave behind confusion if your beneficiary information hasn't been reviewed in 20 years.

Know where your money is going.

Don't assume. Verify.

➡️ NEXT: Power of Attorney — Who Can Handle Your Affairs If You Can't?

So far we've talked mainly about what happens after you die.

Now we're going to talk about something equally important:

What happens if you're still alive—but you can't handle your own financial affairs?

We'll cover:

✍🏽 Texas Statutory Durable Power of Attorney

👤 Choosing an agent

💰 What authority you're giving that person

⚠️ When the authority begins

🟢 Whether you can prepare one yourself

🟡 Whether it needs notarization

📄 Where to get the Texas form

🔴 When you should involve an attorney

Because estate planning isn't only about preparing for death.

It's also about preparing for life when you may need someone else to help you.

← PAGE 4: BANK ACCOUNTS, BENEFICIARIES & YOUR MONEY

🏠 ESTATE PLANNING HOME

PAGE 6: DURABLE POWER OF ATTORNEY IN TEXAS →

⚖️ IMPORTANT DISCLAIMER

This information is provided for general educational purposes only and is not legal, tax, insurance, investment or financial advice.

Retirement plans, IRAs, investment accounts and insurance policies can have different beneficiary requirements. Federal law, Texas law, plan documents, divorce orders and individual circumstances may affect the outcome.

Always verify beneficiary information and procedures directly with the company or plan administrator responsible for the account. Obtain qualified legal, tax or financial advice when your circumstances require it.