If you've contributed to a retirement account (IRA, 401(k), or other individual plan), then you've probably already avoided probate for the money in the account. That's because when you set up an account, your employer or the plan administrator typically gives you a form to fill out, asking you to name a beneficiary to inherit the funds in the account at your death. If you entered the name of one or more persons you want to leave the money to, you're in good shape. They'll be able to collect the money quickly and easily, without probate.
Still, there are some things you should know about naming beneficiaries: the rights of your spouse, the drawbacks of naming more than one beneficiary, and more. Here is information about your choices, so you can make the best decisions for your family.
Estate Planning: IRAs and 401(k) Accounts
Retirement plans can be a significant part of your estate plan.
Required Minimum Distributions (RMDs) From Retirement Accounts
Eventually, you must take money out of your non-Roth retirement accounts every year—or pay hefty penalties.
How the SECURE Act Affects Your Retirement and Estate Plans
Stay up to date on the new rules that impact your IRA and 401(k) contributions, withdrawals, and inheritances.
Naming Your Spouse to Inherit Retirement Accounts
Leaving your IRA to your spouse is usually a good choice, for several reasons.
Naming a Non-Spouse Beneficiary for Retirement Accounts
Here are some considerations when naming someone besides a spouse as a beneficiary to your qualified plan or IRA.
If You Don't Want to Leave Retirement Accounts to Your Spouse
Your spouse--or former spouse--may have a legal claim to your retirement account, so proceed with caution.