One of the core components of a functional estate plan is the selection of beneficiaries. Often, you will choose people you care about to acquire your assets.
As your life progresses, you may want to change who you have previously named as a beneficiary. Because your beneficiaries play such an integral role in your plan, keeping their information up-to-date will avoid confusion and disappointment.
It is not unlikely that the relationships in your life will have ups and downs. Over time, someone you once had a good relationship with and named as a beneficiary may no longer have the characteristics that make the relationship worth pursuing. For example, if you have divorced, you may not want your ex to remain the sole beneficiary of your assets. According to U.S. News, divorce and remarriage are some of the most common reasons you may need to update your beneficiaries.
To change a beneficiary, you will need to carefully follow instructions to ensure the legality of everything. Make sure that all supporting documents reflect your desire to change your beneficiaries. When naming someone new, you may need the following information:
- The person’s date of birth
- The person’s social security number
- The person’s relationship to you
- The person’s full name
Circumstances outside of your control may also influence your beneficiary designations. Death, for example, may prevent someone you named from acquiring your assets completely. Serious illnesses or personal challenges may also affect your beneficiary’s willingness or ability to participate in your estate plan.
At the earliest sign of needing to update your beneficiaries, it is in your best interest to act promptly. Your vigilance in making needed changes can protect the integrity of your plan and prevent confusion from thwarting your end-of-life desires.