IRA inheritance Tips
1) Set aside time at least once a year to update your beneficiary forms. Your beneficiary forms will override your will 99% of the time so it’s important to keep these forms up-to-date and make sure your will and your designated beneficiaries on accounts don’t contradict each other. You should fill out a new form if you’ve had a birth, death, marriage, or divorce in your family. If you can’t find your beneficiary designation form, ask the financial institution for a new one. If you choose to fill out this form online, make sure to print a hard copy for your files.
2) When filling out a beneficiary form, don’t forget to designate percentages next to the names of your beneficiaries. You can also write “in equal shares” if you want the assets to be distributed equally. Also know that writing “per stirpes” which is Latin for “bloodline,” will make sure that only someone in your bloodline will get your assets.
3) If the institution where your money is held changes its name or merges with another bank, fill out a new form. Forms with old institution names may not be valid and the banks won’t go out of their way to tell you.
4) Keep hard copies of your beneficiary forms, including your “payable on death” forms and your “transfer on death” forms in your emergency file. If all of these forms are in your account online, keep hard copies on hand because computer systems change and the forms might be hard to track down, especially if the bank has merged or changed names.
5) Consider hiring a certified estate planner who is licensed in your state. Many financial planners and attorneys who do not specialize in estate planning can make mistakes when filling out forms because of state-specific rules and laws, or just plain lack of experience.
When is the last time you’ve updated your financial forms?