Day 14 Of 30 Days Of Stay-At-Home Personal Finance Wins: Update Your Beneficiaries

4 minute read

What if you were able to come out of this time of social distancing and economic crisis with a stronger and healthier financial life? What if you looked at this as an opportunity to take a little bit of your extra time each day to work on your finances?

Since it takes me about 35 minutes to drive to work in the morning and 45 minutes on the way back home, I have an extra 1 hour and 20 minutes of my day that I don’t have to drive while I’m working from home that I can use to accomplish something. This doesn’t even take into consideration all of the networking and social events that would usually take up some of my time throughout the week.

Obviously, your situation is different than mine (and probably a whole lot different if you have kids at home who would otherwise be in daycare), but I’m guessing that we all have at least a little extra time right now that we can dedicate to our personal finances.

It looks like we’re going to continue to practice our social distancing skills at least through April, and now is a great time to work on creating a better financial situation, so I’m giving you 30 days of stay-at-home personal finance wins throughout April.

Unfortunately, I understand that there are many who have (and who will) lose their jobs during this time of uncertainty and objectively will not come out on the other side of this with a stronger financial situation. Hopefully, many of these personal finance wins can help to lessen the blow and make things easier on them. On the other hand, I think that many of these wins are still relevant to those who are fortunate enough to be in a position to not have to worry about their job and their finances to help them build a healthier financial life.

Day 14: Update Your Beneficiaries

Yep, you’re going to have to log back into your financial accounts one more time for today’s financial win. I would be willing to bet that most people have either never added beneficiaries to their financial accounts or have never updated them since they were first added to the account. This just isn’t something that very many people think about, but is an important part of cleaning up your financial life.

Take some time to review the beneficiaries on your financial accounts and see if they’re in good shape or if you need to update them. Depending on your provider you may be able to login to the account and update them or you may have to make a phone call to do so. Often, you can find beneficiary information in the “profile” section within your account login.

You can review the beneficiaries on your retirement accounts, life insurance policies (including through your employee benefits), and other investment assets. You can also check with your bank to review and update the transfer on death (TOD) designations on your bank accounts.

Who To Designate

How do you know who your beneficiaries should be? If you have estate planning documents in place, then your last will should have beneficiaries listed within it that you can use to update your accounts, including a primary beneficiary as well as contingent beneficiaries. Estate planning attorneys will often provide plain English instructions for how to list the beneficiaries on your financial accounts if you read through the will and don’t quite understand what it’s saying.

If find that your wishes have changed after reviewing your will and the beneficiaries that are listed within the document are not who you want to receive your assets if something were to happen to you, then you may want to consider speaking with your estate planning attorney about an update.

If you don’t have estate planning documents in place, then now may be a good time to consider having them drafted. If you’re not ready to go that far, then you can take the time to put some deep and considerate thought into who you would want to receive your assets if something were to happen to you. Often for couples the primary beneficiary is the spouse and the contingent beneficiaries (who the assets would go to if the primary beneficiary were not living) are children. However, each situation is unique and this is not always the case. Other beneficiaries such as trusts can come into play as well.

If you have estate planning documents in place and/or you’re clear on who you would like your beneficiaries to be, then this should be a pretty easy clean up item to accomplish and get another financial win under your belt. If not, then you may have some more consideration ahead of you.

Please note that this is not legal advice and you should contact an attorney for any legal advice that you need.