Content Overview
- Summary
- You May Name More Than One Person As Beneficiary Of A Life Insurance Policy
- You May Name A "Class" Of Individuals As Beneficiary Of A Life Insurance Policy
- You May Have Primary And Contingent Beneficiaries
- A Beneficiary Of A Life Insurance Policy May Be "Revocable" Or "Irrevocable"
- Different Types Of Beneficiary Designations May Be Combined
- Understand The Consequences If You Want To Name A Minor As Beneficiary
- If You Want To Name A Spouse Your Beneficiary, Be Clear Whether It Is The Relationship That Controls
- You Can Name A Significant Other Or Life Partner As Beneficiary With Discretion If You'd Like
- You Can Name Your Estate As Beneficiary Of A Life Insurance Policy
Naming A Beneficiary For Your Life Insurance Policy
If You Want To Name A Spouse Your Beneficiary, Be Clear Whether It Is The Relationship That Controls
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Naming your spouse as beneficiary will prevent the proceeds of your life insurance from being added to your estate for estate tax purposes. All bequests to a spouse pass to the spouse free of estate tax.
Still, keep in mind, that the proceeds could then be taxable as part of your spouse's estate -- unless, of course, the spouse spends the money.
In order to avoid confusion, list the person by name rather than by your relationship. If the beneficiary is "My husband, Harry Simms" there will be a question whether Harry receives the proceeds if you are remarried at the time of your death. If you want Harry to be beneficiary whether the two of you are married or not, designate the beneficiary just by name.
NOTE: Should you divorce, be sure and change the beneficiary if that is your wish. Divorce papers by themselves will not change the identity of whoever is the named beneficiary.
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