Beneficiaries of Wills – What to Know
Most people do not like thinking about their death. However, this is a reality of life that we cannot wish away. It is for this reason that writing a will is important. Knowing your dependents is the first step in writing the will. Very many different people can be the dependents. It is important though to let them know of the contents.
The definition of a beneficiary is the person who is in line for inheritance upon death of the owner of the will. The beneficiary is named as a successor of an estate, investment or even insurance policy. Sometimes the beneficiary is a minor which means that they will wait to reach legal age to get the benefits in the will. The benefactor should tell the beneficiaries about the will early. This way, there will be no confusion one he or she passes on.
A written will should be revisited once in a while. There are life changes that can lead you to change the content of the will. Consider having alternate beneficiaries in the will. If the primary beneficiary dies, the secondary one takes over. Ensure that your will is updated at all times.
There are several categories of beneficiaries. The first category has irrevocable beneficiaries. Get legal counsel and financial advice before settling on an irrevocable beneficiary. Irrevocable beneficiaries are very difficult to change. On the other hand, there are revocable beneficiaries. This one can be changed in case something happens in life. For instance, factors like marriage or divorce.
A primary beneficiary is defined as the person who is in line directly to receive your assets upon your death. Insurance companies will always ask for this person first. Then there is a contingent or alternate beneficiary. This is the alternative beneficiary if the primary beneficiary was to die before getting the inheritance. Another group is that of residuary beneficiaries. These are named to get very particular items from the benefactors. Case in point is a grandmother gifting a specific jewel to a grandchild.
Point to remember is that residuary beneficiaries can also have alternate residuary beneficiaries in place. A will can name many people. The spouse is the most preferred person by most people. However, it is important to name an alternate beneficiary after the spouse. Children would be the ideal alternate beneficiaries after the spouse is named as the primary beneficiary. Most people do however name children as primary beneficiaries.
It is also possible to have charities and friends as beneficiaries in your will. You make this call. To get more info and discover more about how to write your will, visit the homepage of a credible website and learn more. Generally, writing a will is very important since nobody knows when death will occur hence the importance of preparing in advance.
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