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Beneficiaries of Wills – What to Know

Most people do not like thinking about their death. It is however impossible to ignore death as a reality of life. This is why you are advised to write a will early in life. 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.

The definition of a beneficiary is the person who is in line for inheritance upon death of the owner of the will. The beneficiary is named as a successor of an estate, investment or even insurance policy. If the beneficiary is a minor upon death of the will owner, he or she will inherit the property upon attaining legal age. It is important for the benefactor to let the beneficiaries know about the will early. This way, there will be no confusion one he or she passes on.

A written will should be revisited once in a while. Changes in life can necessitate altering the will. Of importance also is that you should also have alternate or 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 different types of beneficiaries to be considered as you write your will. The first category has irrevocable beneficiaries. Seek advice of your attorney and financial advisor before naming irrevocable beneficiaries. This is because it is very difficult to change these beneficiaries once they have been included in the will. On the other hand, there are revocable beneficiaries. This category of beneficiaries can be altered. Things like marriage or divorce can call for alteration of beneficiaries.

A primary beneficiary is basically the person who receives the money once you die. This person is of interest to most insurance companies. The other group of beneficiaries is the contingent or alternate beneficiary. In case there is death of the primary beneficiary, then the contingent beneficiary stands to inherit the properties. Others are residuary beneficiaries. Residuary beneficiaries get very unique and specific items stated by the benefactor. Case in point is a grandmother gifting a specific jewel to a grandchild.

Point to remember is that residuary beneficiaries can also have alternate residuary beneficiaries in place. People to be named in a will are many. Most people prefer to name their spouses as primary beneficiaries. After naming the spouse, it is good to name the alternate beneficiary. A good choice here would be the children. To many other people, children are primary beneficiaries.

It is also possible to have charities and friends as beneficiaries in your will. It is a personal choice. 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.