The process seems pretty simple — you fill out the beneficiary form when you open your IRA account, tuck it away, and you’ve secured your legacy for your loved ones. What could possibly go wrong? Well, let’s see …
Failing to Update Your Beneficiary Form
Consider these potential outcomes that could result from outdated IRA beneficiary forms:
- Your ex-spouse — and her new spouse — may inherit your IRA.
- Your children from a previous marriage are disinherited.
- Your brother, named as your beneficiary before you married, inherits your IRA and refuses to share it with your beloved spouse and children.
- One of your children predeceases you, and you disinherit that child’s family.
While these scenarios may make great reality TV, they don’t play well in real life. Review and update your beneficiary forms regularly and especially after a life-changing event such as marriage, divorce or death of a beneficiary. Read what else could possibly go wrong in my latest Invesco blog post.
Thomas Rowley is the Director of Retirement Business Strategy at Invesco.
Invesco does not offer tax advice.
Invesco Distributors, Inc. 04/15 US3740
