Beneficiaries of Wills – What to Know
Most people do not like thinking about their death. It is however impossible to ignore death as a reality of life. This is the reason why it is important to write a will so that your dependents can be comfortable when you leave this world. Writing a will starts with naming your dependents. There are many people who can be the dependents. It is important though to let them know of the contents.
A beneficiary is defined as the person named in the will to inherit the property. The successor to an estate or other assets is the beneficiary. If the beneficiary is a minor upon death of the will owner, he or she will inherit the property upon attaining legal age. It is important for the benefactor to let the beneficiaries know about the will early. This will eradicate confusion when you die.
Even after writing the will, revisit it regularly. Life brings about many changes hence the need to review a will regularly. Of importance also is that you should also have alternate or secondary beneficiaries. In case the primary beneficiary in the will dies, the secondary one takes over. Keep your will documents up to date.
Beneficiaries fall in different categories. The first category has irrevocable beneficiaries. Seek advice of your attorney and financial advisor before naming irrevocable beneficiaries. Irrevocable beneficiaries are very difficult to change. Then there are revocable beneficiaries. This category of beneficiaries can be altered. Beneficiaries can be altered due to things like marriage or divorce.
The person who is designated to receive property when you die is the primary beneficiary. Insurance companies will always ask for this person first. The other group of beneficiaries is the contingent or alternate beneficiary. In case there is death of the primary beneficiary, then the contingent beneficiary stands to inherit the properties. Others are residuary beneficiaries. These are named to get very particular items from the benefactors. For instance, a grandmother can name a grandchild to receive her special ornaments upon her death.
Point to remember is that residuary beneficiaries can also have alternate residuary beneficiaries in place. There are many people who can be named as beneficiaries in a will. A lot of people prefer to have their spouses as beneficiaries. However, it is important to name an alternate beneficiary after the spouse. Children fit this part perfectly. There are many people who prefer to have children as primary beneficiaries.
There are special cases where people name friends or charities as beneficiaries to their assets. You make this call. More information about wills can be found online for further reading. In conclusion, it is important to write your will early since we never know what will happen next in life.