Estate Planning Glossary
A person or organization designated to receive assets from a will, trust, life insurance policy, or retirement account.
Plain English
A beneficiary is whoever you name to receive something when you die. That can be a family member, friend, charity, or even a trust. Beneficiaries in a will go through probate. Beneficiaries named directly on life insurance and retirement accounts bypass your will entirely — they get the money regardless of what your will says.
Why it matters
Outdated beneficiary designations on life insurance and retirement accounts override your will. An ex-spouse named on a 401k from 10 years ago receives that money — regardless of your current wishes.
First Light includes a free beneficiary checklist that helps you verify all designations are current.
Common questions
Yes. Beneficiary designations on life insurance policies, retirement accounts, and payable-on-death accounts pass outside your will entirely. These designations override whatever your will says. Keeping them updated is as important as the will itself.
If you named a contingent beneficiary, they receive the assets. If no contingent beneficiary was named, the assets typically pass to your estate and go through probate. Name both primary and contingent beneficiaries on all accounts.
Technically yes, but it creates problems. Minors cannot legally receive large sums directly. A court will appoint a custodian to manage the money until they turn 18 or 21 depending on state law. A better approach is naming a trust as beneficiary or using a UTMA account.
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