“Sometimes the poorest man leaves his children the richest inheritance.” – Ruth E. Renkel
You could – even unintentionally – be leaving someone out in the cold by not updating your financial and insurance plans.
I have a friend whose ex-husband didn’t get around to changing his beneficiary on his 401(k) and life insurance policies. He had two minor children from a previous marriage. When he died in a motorcycle accident, the ex-wife inherited about $1 million while his own kids were completely disinherited. It was unintentional, of course.
My friend decided to give the money to the kids. She did it out of her good grace because she sure could have just kept the money – legally it was hers. Unfortunately, though, the kids lost a pretty penny to taxes that had to be paid because their father had not updated his beneficiary designations. It only takes a few minutes to do…
Life changes all the time, and we just don’t think about it. Births in the family, deaths, marriages, divorces, job changes, moving to a new home – all of these things are life changes. A good rule of thumb is to review your financial plans, including your beneficiaries, each time you experience a life event. That way your plans don’t get out of sync with your life.
If you already know which day will be your last one here on Earth, then feel free to put off this planning. Otherwise, it’s much better to think about it now and make sure that your loved ones are taken care of the way you want them to be. True, no one enjoys doing this, but we do it out of love.