3 Reasons to Update Your IRA Beneficiary Designation

Updating your IRA beneficiary designation is an important step in the estate planning process. There are a number of reasons that you could potentially want to update your IRA beneficiary designation. Here are a few reasons to consider.

1. Divorce

One of the best reasons to update your IRA beneficiary designation is because of a divorce. If you go through divorce, you do not want your ex-spouse to be able to have any access to your IRA funds after you pass away. Instead, you should quickly change the designation to one of your children or someone else that you want to leave your assets to.

2. Death of Beneficiary

Another potential reason that you might want to change your IRA beneficiary designation is because of the death of the beneficiary. For example, if you are married and your spouse passes away unexpectedly, you will want to change the beneficiary designation as soon as you can. Otherwise, the assets in your account might have to go through probate if you pass away before making the change.

3. Disinheriting

You might also want to change the beneficiary designation on your IRA if you want to disinherit one of your children. By doing this, you will be able to avoid giving money to a child that you do not want to help financially.

blog comments powered by Disqus