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Tips for choosing beneficiaries of your pension

by | May 15, 2018 | Division Of Pensions

For those of you who work in professions that offer pensions for your retirement, you need to know the best ways to choose beneficiaries. Each person will make different choices. Some of those choices could be detrimental to your estate. Here are some important tips for choosing the beneficiaries to your pension in Oneida, New York.

One of the most important tips you can follow is to review your pension plan beneficiaries after each major life event. You need to look at the people who are listed because they might not be in your life anymore after the event. For example, a divorce, a death or a marriage could rearrange your entire family.

A big mistake many people make when assigning beneficiaries to their pension is naming a trust as the beneficiary instead of a person. This means that the benefits from the pension go to the trust. Because the beneficiary is a trust, the only people who can receive the benefits from the pension are dependent children at the time of your death or a person who is disabled.

Another mistake commonly made is when people do not list beneficiaries at all on their pension documents. This has become a more difficult mistake to make because many retirement accounts do not let you open the account without naming at least one beneficiary. Some accounts will choose a default beneficiary for you, like your spouse or children. You need to set the beneficiary yourself if you want to pick who receives the benefits.

Determining who you will name as the beneficiaries of your pension in New York is an important step you cannot skip. Make sure you follow the tips outlined in this post to ensure that you are choosing the right beneficiaries.