Smart Ideas: Revisited
Understanding a Will as a Beneficiary
People fear talking about death. It is however impossible to ignore death as a reality of life. This is the reason why it is important to write a will so that your dependents can be comfortable when you leave this world. Writing a will starts with naming your dependents. Dependents can be different people ranging from family members to friends. It is also important for dependents to understand the will and how to translate its contents.
A beneficiary is the person who is named in a will to benefit from the assets of the person who wrote the will. The successor to an estate or other assets is the beneficiary. If the beneficiary is a minor upon death of the will owner, he or she will inherit the property upon attaining legal age. As the benefactor, let the beneficiaries be aware of the will early. This will eradicate confusion when you die.
A written will should be revisited once in a while. Life brings about many changes hence the need to review a will regularly. Do also have alternate beneficiaries, also called secondary beneficiaries. This means that if the primary beneficiary was to die, the secondary ones will inherit your assets automatically. Always ensure your will documents are up to date.
There are several categories of beneficiaries. The first one is the irrevocable beneficiary. Get legal counsel and financial advice before settling on an irrevocable beneficiary. Irrevocable beneficiaries are very difficult to change. The second type is the revocable beneficiary. This one can be changed in case something happens in life. Things like marriage or divorce can call for alteration of beneficiaries.
The person who is designated to receive property when you die is the primary beneficiary. Most insurance companies want to know the primary beneficiary. Then there is a contingent or alternate beneficiary. This is the alternative beneficiary if the primary beneficiary was to die before getting the inheritance. Apart from the primary and the alternate, there are also residuary beneficiaries. These are persons named to receive specific items from the benefactor. For instance, a grandmother can name a grandchild to receive her special ornaments upon her death.
Point to remember is that residuary beneficiaries can also have alternate residuary beneficiaries in place. There are many people who can be named as beneficiaries in a will. The spouse is the most preferred person by most people. After naming the spouse, it is good to name the alternate beneficiary. Children would be the ideal alternate beneficiaries after the spouse is named as the primary beneficiary. Most people do however name children as primary beneficiaries.
There are special cases where people name friends or charities as beneficiaries to their assets. You make this call. More information about wills can be found online for further reading. Generally, writing a will is very important since nobody knows when death will occur hence the importance of preparing in advance.