Suggestions for naming beneficiaries when planning an estate

A concise estate plan has exponentially more power than a hidden letter or a well-thought out plan inside of someone’s head. When people are considering whether or not to create a trust, write a will, coordinate long-term care or establish estate plans in Tennessee, the sooner they make the decision to follow through, they can reduce the stress and confusion that their family may otherwise be facing following their death.

One of the major components of estate planning is selecting and designating named beneficiaries who will be receiving a person’s property, assets or financial awards following his or her death. According to Fidelity Investments, policy-holders can help their beneficiaries enjoy their reward to a maximum value by beginning to allot rewards before a death occurs. For example, people may consider donating to a college education fund for dependents, giving cash for medical expenses or helping children and grandchildren to secure their own retirement future.

When the time comes for people to designate beneficiaries, they should remember that beneficiaries do not have to be related by blood. Other options they may consider include friends or even charities they are connected with. They have the power to modify who their beneficiaries are at any time and may even have the option of dictating a “contingent” beneficiary who is next-in-line should the previously-named person not be able to collect their benefits for some reason. Lastly, people should be aware that different estate plans have varying tax benefits that should be considered before making a final decision.