You could be in for a rude awakening if you don’t remember who you’ve named as beneficiary of your investment accounts or life insurance policies. Beneficiary designations for an annuity, IRA, 401(k), 457(b), Roth IRA or life insurance policy transfer the asset to the named person or persons regardless of the named beneficiaries under a will or trust. It is not uncommon for someone to name their parent or sibling as beneficiary of their 401(k) for example, when they secure their first job after finishing college. Yet, they sometimes forget to update their beneficiaries when they get married (or divorced) or have children. If the owner dies unexpectedly, even if he or she clearly would have preferred their 401(k) be distributed to his or her spouse, the account will be distributed to the nominated beneficiary. This, of course, can potentially cause a real mess for the surviving spouse and children. Take a few minutes to review your beneficiary designations to make sure they reflect your current wishes. You should also review them whenever your circumstances change such as in marriage, divorce, childbirth or death.
A recent Bloomberg View article explores the implications of General Electric’s multi-billion dollar losses from its long term care insurance unit and the challenge of caring for an aging population. In “What’s Bad for GE Will Be Worse for America”, the article opines:
Imagine purchasing a long term care insurance policy to protect against the cost of in-home, assisted living and nursing home costs and 20 years later, the insurance company has informed you of a significant premium increase. Now that you are in your late seventies and unable to purchase a new policy, you have really only […]
Protecting assets from nursing home expenses is an issue that I am frequently asked about. Sometimes it may arise after a heart attack, stroke or other concern. Other times it may arise after a loved one moves into an assisted living facility or nursing home due to Alzheimer’s. Whatever the motivation, it is topic that […]