This is an important question I am asked by clients and the answer may surprise you.
Why do I have to change my beneficiary on my retirement account? Can’t I just name a beneficiary in my Will for this money?
Answer: Beneficiaries listed on retirement accounts override any direction in an Estate Plan. For example, if you get divorced and remarry but fail to put spouse number two as the beneficiary on your retirement account and you list them in the Will to receive this money. Depending on the type of plan there is a VERY strong possibility that the retirement money goes to the individual listed as the beneficiary —eek! Your EX-wife. Imagine the mess that would leave after you pass.
This scenario is one example of why it is critical to work with an Estate Planning Attorney to put your plan in place. Using a professional pays off in so many ways and will provide peace of mind that your wishes are correctly drafted so your wishes can be followed after you pass.
