Make Sure You Designate Your 401k Beneficiaries

Discussion in Retirement Plans started by steph7h • Jan 29, 2015.

  1. steph7h

    steph7hActive Member

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    My husband's employer just moved their 401k plan to a new company last month. We knew the change was coming and were not too concerned, since these transfers usually go smoothly. We received a postcard about a month ago letting us know "Your plan's transition is complete" on the front of the card. I kept it for awhile because I figured we should look at his plan online once it was set up, and on the back of the card were the instructions for doing so. Well, looking at the back of the card today, I saw that they specifically say you have to designate beneficiaries with the new plan, as those were not transferred over during the switch from the former 401k company.

    I was hoping they just put that on the card as a precaution, but no, once we logged on the website for his new plan, there were no beneficiaries listed for his account! I'm so thankful I kept that card and didn't just throw it away like I fear some employees might do, thinking it is junk mail or not that important. Designating the beneficiaries probably wouldn't have changed how the funds would have been legally distributed anyway in our case, but for people with more complicated family structures, this can be a huge oversight if beneficiaries are not designated!

    So, even if you think the 401k administrators are transferring everything over, make sure you check on your beneficiaries any time they change companies!
     
  2. Sugarhill

    SugarhillActive Member

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    As someone that didn't get all that I should've received after a death in the family, (I was the caretaker, the other person was absolutely not :mad:) definitely check to see if you have beneficiaries, but also that they are the ones you still want to help/leave the money to on a periodic basis. Situations change and sometimes, percentages need to reflect that.
     
  3. forehandflick

    forehandflickNew Member

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    As a young employee who just currently entered the workplace, how should I account for this? I don't have anyone in particular to designate my 401K to, but I certainly don't want it to get lost in the ledger if something were to happen to me. I have no children or significant other yet, so should I be forwarding the funds to siblings or even parents?
     
  4. clairebeautiful

    clairebeautifulActive Member

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    I'd take the advice in this post one step further and add that if you are married and definitely if you have kids but have not yet written a will, make it your 2015 resolution.

    There is just too much headache waiting for your loved ones on the other side of your death, if such an unfortunate event should occur.

    Honestly, there are three documents every adult should have done: a last will and testament, durable power of attorney, and healthcare power of attorney. Just a good idea to get that one off the bucket list in case you kick the bucket (or don't quite but are left as a vegetable).