Common Mistakes That Derail Plans

Failing to update designations after divorce may leave assets to an ex-spouse Naming someone who has predeceased you can force assets through probate Forgetting to add designations on new accounts creates unintended gaps Not updating after major life events like marriage, birth, or death

Per Stirpes, Per Capita, and Contingent Beneficiaries

Per stirpes passes a deceased beneficiary's share to their children equally Per capita divides assets equally among surviving beneficiaries only A contingent beneficiary inherits if the primary cannot; without one, assets may go to probate Review contingent designations with the same care as primary ones

Naming a Trust or Minor as Beneficiary

A trust as beneficiary provides control over how and when assets distribute Naming a trust on retirement accounts may accelerate required distributions Minors cannot directly inherit — a court may appoint a guardian of the estate Consider naming a trust rather than the minor on each account for more control

Retirement Account Rules — SECURE Act

The SECURE Act requires most non-spouse beneficiaries to empty IRAs within 10 years Eligible designated beneficiaries — spouses, minors, disabled — can still stretch distributions Inherited IRA distribution rules depend on whether the owner had begun RMDs Bunching 10-year withdrawals into lower-income years may reduce tax impact

Life Insurance Beneficiary Considerations

Naming your estate as beneficiary subjects proceeds to probate and creditors An irrevocable life insurance trust can remove proceeds from the taxable estate Community property states may give a surviving spouse automatic rights Review ownership, insured, and beneficiary roles to avoid gift tax issues

Coordinating With Your Estate Plan

Designations should align with the goals in your will and trust documents Keep a master list of all accounts and their named beneficiaries Review and update designations at least once a year or after any life change Work with your attorney to confirm designations match your overall plan

Beneficiary Designation Mistakes

Curated by: Rubric Advisors

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Why Designations Override Your Will

Beneficiary designations on accounts supersede instructions in a will or trust
Retirement accounts, life insurance, and TOD accounts pass by designation
A will cannot redirect assets that have a valid beneficiary named on file
Outdated designations are one of the most common estate planning failures

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Why Designations Override Your Will

Common Mistakes That Derail Plans

Per Stirpes, Per Capita, and Contingent Beneficiaries

Naming a Trust or Minor as Beneficiary

Retirement Account Rules — SECURE Act

Life Insurance Beneficiary Considerations

Coordinating With Your Estate Plan

Related Topics

Estate Planning Deep Dive

Irrevocable Life Insurance Trusts (ILITs): Keeping Insurance Out of Your Estate

Financial Planning for New Parents

Why Designations Override Your Will

Common Mistakes That Derail Plans

Per Stirpes, Per Capita, and Contingent Beneficiaries

Naming a Trust or Minor as Beneficiary

Retirement Account Rules — SECURE Act

Life Insurance Beneficiary Considerations

Coordinating With Your Estate Plan

Related Topics

Estate Planning Deep Dive

Irrevocable Life Insurance Trusts (ILITs): Keeping Insurance Out of Your Estate

Financial Planning for New Parents