Life Insurance, Retirement and POD Designations
All beneficiary designations take precedence over the terms of your will and trust, therefore, care must be taken to name the appropriate parties.
Life insurance companies request a beneficiary designation at the time of the application. In addition, the owner of the policy may change the beneficiary at any time upon the appropriate form from the insurance company. Typically, we recommend that your revocable trust be named as the beneficiary of all life insurance policies that are not dedicated to another use. This way the trustee will have sufficient liquidity and maximum flexibility to use the proceeds as it sees fit under the circumstances.
Investment and bank account Pay on Death account designations (POD) may also be used to transfer assets to your trust or loved ones directly upon your death. This information may be added to your account information or signature as provided by your financial institution.
Retirement account assets also have beneficiary designations. The rights and tax obligations of the beneficiaries are defined by the designation itself. Whether to name your loved one or your trust depends on your priorities and objectives.
If you would like more information on Life Insurance, Retirement and POD Designations, please give us a call at 480-281-1512 or fill out the form on the right.