Your account beneficiary designations could be more important than your will
Remember the "pinky swears" - the silly promises you made to your friends back in grade school? What if someone came back to you decades later as an adult and expected you to abide by those promises? It's unlikely they would ever prevail in a court of law. But if you designated someone as a beneficiary to your retirement account or other investment accounts, the law would abide by what you decided back then, no matter how many years ago. And a will, even if it were current and up to date, won't help.
Beneficiaries specified on an insurance policy or qualified plan account do not need to go through probate - the often lengthy and expensive court process that an estate goes through. In fact, life insurance, annuities, 401(k)s, pensions and IRAs can all be transferred via beneficiary designation and outside of the domain of a will. This can help streamline the process of your beneficiaries receiving an inheritance should you pass away. It is also why it is critical to keep your beneficiaries on all your accounts up to date.
"Updating beneficiaries is especially important for those who experience life changes in their families such as marriages, deaths, births and divorces."
You don't want to end up like one of the horror stories where the wrong person ends up with your financial legacy because you forgot to update a form. Updating beneficiaries is especially important for those who experience life changes in their families such as marriages, deaths, births and divorces. In general, beneficiaries are not legally required to be notified that they are a beneficiary or if there are changes to their status as a beneficiary.
The Beneficiary Designation section of VALIC.com recently received an upgrade to help streamline the designation process. The main change - a "Designee Profile" page - captures your beneficiary information and stores it on VALIC.com. This means you can select your designees from a drop-down menu instead of having to retype your personal information for each plan or account you have with AIG Retirement Services. This upgrade is intended to enhance your online retirement planning experience as well as encourage you to protect your assets by designating a beneficiary through the simplified process.
Securities and investment advisory services offered through VALIC Financial Advisors, Inc. (“VFA”), member FINRA, SIPC and an SEC-registered investment adviser.
Annuities issued by The Variable Annuity Life Insurance Company (“VALIC”), Houston, TX. Variable annuities distributed by its affiliate, AIG Capital Services, Inc. (“ACS), member FINRA.
AIG Retirement Services (“ARS”), represents AIG member companies -The Variable Annuity Life Insurance Company (“VALIC”) and its subsidiaries VALIC Financial Advisors, Inc. (“VFA”) and VALIC Retirement Services Company (“VRSCO”). All are members of American International Group, Inc. (“AIG”).
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