Who’s the Beneficiary?

Wait. What?

Something that can easily be overlooked in the beginning stages of divorce is updating your beneficiaries.

You’re getting a divorce = you don’t want your soon to be ex to still inherit all you’re worth in the event something happens to you.

So who should you change it to? Weigh carefully if you want your children to automatically become the new beneficiaries. If they’re under the age of 18, and unless you’ve set up a trust, chances are your ex will get control of the inheritance. Some choose to designate a parent or sibling but specify that they want the funds set aside for the kids. This is a good option if there is someone in your family you can rely on.

You’ll want to make sure you update everything possible: life insurance, investment accounts, pension etc. Most accounts have easily accessible beneficiary change forms online.

Unfortunately you’re stuck leaving your spouse as the beneficiary to any employer 401k plan, unless you can get him or her to sign over his or her rights. But don’t hold your breath on it.

And just remember, the likelihood of something happening to you is low, but the longer your divorce plays out, the more important this step becomes.

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