Individual company 401(k) retirement plan participants have had to deal with radical changes in the structure of the American family over the last few years.
Moms and Dads don’t get married forever. Some get married again and bring their previous children with them to their new family. Same sex couples can now get married in most states.
Today’s families are made up of many combinations. Your individual company 401(k) retirement plan account needs to be updated to reflect those combinations.
The important decisions about “who gets what” need to be made and updated accordingly. My role as investment advisor to individual company 401(k) retirement plan participates requires me to record those decisions in the right legal documents.
By law, each individual company 401(k) retirement plan participant has to designate a company 401(k) retirement plan account beneficiary. The beneficiary can be an individual, a group of individuals, a will, or a trust.
The beneficiary rules are the same for company 401(k) retirement plans, IRA’s, annuities, and life insurance policies.
Review the names of your beneficiaries on each of your important family asset investment accounts. Your named beneficiaries need to be up-to-date and reflect any changes in your family structure over the last few years.
Your ex-spouse may still be named as the beneficiary of your company 401(k) retirement plan account. I have seen it happen. I can also tell you that no state court judge will be at all sympathetic to your “I forgot to change it” excuse.
Don’t allow a previous family relationship to receive a substantial financial gain from your company 401(k) retirement plan account. Make sure that money goes where you want it to go.
Make plans to take care of your loved ones after you are gone. Start with your company 401(k) retirement plan account beneficiary.
Ric Lager
Lager & Company, Inc.
