Your Guide to Choosing Beneficiaries

American Investment Planners LLC

500 North Broadway, Suite 260, Jericho, NY 11753

(516) 932-5130 / (866) 932-5130

Most people are concerned with who is handling their money and their assets now, and although you may not want to think about it, it's equally as important to figure out who will take control upon your passing. This is where beneficiaries come in - by definition, a beneficiary is:

the person named in a life insurance policy, annuity, will, trust, or other agreement to receive a financial benefit upon the death of the owner, and it can be an individual, company, organization and so on.

If you recently started a new job and are in the process of setting up a 401(k), for example, you may have seen something about choosing a beneficiary for your account. And although you may already have someone in mind, there are a few things to consider before making an official decision about who you'll name as your beneficiary. Here are two quick things to remember:

1. Look for rules and restrictions. First, you should find out if there are any rules or restrictions for who you can name as your beneficiary - for example, if you are married but do not want to use your spouse, is there something you have to do in order to name someone else? 
2. Choose a primary and a contingent beneficiary. It isn't enough to just name a primary beneficiary - you should also have a contingent beneficiary as well. To help you better understand the two, a primary beneficiary is the person that you decide will receive all of your assets upon your passing. However, if that person passes before you, your death benefit will then be given to your contingent beneficiary.

Now it comes down to who you will actually choose. Should you choose a parent? A spouse? A child? Another relative? A friend? Here are some general guidelines that you can follow:

• If you are married, consider your spouse - this is the route many married couples take.
• If you have a child, you may want to consider including them as one of your beneficiaries, especially if your children are older and you are not married anymore. Keep in mind though that minor children cannot be chosen as beneficiaries, so if you want your minor child to receive a financial benefit, you'll want to look into a trust.
• If you are not married, select from a close friend, a sibling, a partner or even a charity - there are not usually many restrictions for who you can name under these circumstances.

Seeing as how choosing a beneficiary is an extremely important task and one that should not be taken lightly, we at American Investment Planners LLC want to help you so that you can rest assured knowing that you've made the right decision. If you need to choose a beneficiary for a certain policy or plan and/or have adult children who need to do the same, give us a call at (516) 932-5130 or email us at info@americaninvestmentplanners.com to set up an appointment with one of our advisors.