Beneficiary Designation

Most people feel that if they have a will or trust they are finished with their estate planning and the important work of disposing of their earthly assets. This assumption is not accurate because many of a person’s assets are not covered by a will or trust.

  • Retirement assets like a 401(k) plan, a 403(b) plan or an Individual Retirement Account (IRA) are transferred at death based on a beneficiary designation form that you fill out with the plan’s administrator. There are tax consequences with retirement plan assets. They are an excellent asset to consider giving all or a portion of to a charity, like your parish, parish school or other diocesan agency in the diocese because charities do not pay taxes.

  • Other assets also transfer at death by beneficiary designation. These include insurance policies, financial accounts, like bank or brokerage accounts, Certificates of Deposit (CDs) and U.S. Savings Bonds. At financial institutions, beneficiary designation forms are often called transfer-on-death or pay-on-death forms.

Be sure to keep your beneficiary designations on these assets up to date to reflect where you want your money to go. Please consider the Church as one of your options for your retirement plan assets, insurance policies and financial accounts.