The Importance of Updating Your Beneficiary Information

  • Post Author:

Oftentimes, folks focus so much on their investment strategies and contributions that they forget about simple things, like updating their beneficiary information. On the surface, this may not seem like a big deal, but it’s actually a huge deal! Today, we’ll go over why so many people overlook updating their beneficiary information, and why it’s so important to do so!

What is the Most Commonly Affected Account?

One of the most commonly overlooked accounts is the workplace retirement account or a 401k. Since most people change jobs a few times throughout their lives, that can lead to having multiple retirement accounts. Often, people forget about their old workplace retirement account once they leave the associated job, which can result in outdated beneficiary information.

Why Do People Tend to Overlook Their Beneficiary Information?

People tend to overlook their beneficiary information for a couple of incorrect misconceptions. The first of which is that once they update one account, all other accounts will follow suit. This, unfortunately, is not the case with most accounts, meaning each account will need to be manually updated.

The second misconception that many people have is that they don’t have to update their beneficiary information since they already have a will or trust in place. This is a false assumption because your beneficiary information actually supersedes any will/trust, which means you risk your money going to the wrong person if something happens to you.

Why is Updating Your Beneficiary Information So Important?

Updating your beneficiary information will ensure that your assets are distributed to the right people as part of your estate plan. After all, if you were previously married, you probably don’t want proceeds from an old 401k to go to your ex-wife!  Having up-to-date beneficiary information will also keep things from going to probate, which will save your loved one’s time, money, and headaches.

Safe Harbor Retirement Can Help

When you work with a trusted financial advisor, you won’t just get financial and investment advice tailored specifically to you and your situation. They can make sure that your beneficiaries are up to date on all of your investment accounts. Safe Harbor Retirement has been helping residents of Ohio plan their retirement and keep track of their finances for years. If you would like to schedule a complimentary consultation with one of our trusted representatives, give us a call at (614) 760-0670 .