It is easy to forget about changing your beneficiaries for retirement plans, investment accounts, insurance policies and your IRA, but if you have recently gotten divorced or remarried or had a death in the family, it is important to update these designations. Your spouse is the primary beneficiary of your 401(k), unless they sign a waiver that allows for someone else to be the primary beneficiary. Transferring the IRA or retirement plan to their name allows them to not have to pay any taxes and maintain the plan’s tax deferral status. Passing retirement assets from a deceased spouse to the survivor is not taxable. You may also want to set up a trust to make sure the money gets to your beneficiaries and has the proper legal language so no messy issues arise when you pass away.
Sorry, comments are closed for this post.