Thinking about estate planning isn’t something most people really want to do, which is why you probably want to check this task off the list and forget about it. But unfortunately, estate planning is not a one-and-done task. Your financial and personal situations can change, and your estate plan needs to change with them. 
While major life events like getting married, divorced, or welcoming a new family member mean that you should get started on updating your plans right away, it’s easy to let this fall through the cracks when you’re in the middle of a stressful situation or when you’re undergoing major life changes like taking care of a new baby.
If you don’t want to end up in a situation where you overlook something after a life change, there’s one task that you should be absolutely sure to do each year:
Review your beneficiary designations each year!
One of the most important estate planning tasks you can do is to review your beneficiary designations each and every year on any accounts that require you to name a beneficiary.
See, many types of accounts require you to name someone who will inherit the account after your death. This includes 401(k)s and certain other retirement plans, as well as life insurance policies. Whoever you list as your beneficiary will receive the money in those accounts, regardless of what your will says.
That’s why it’s so important to make sure those designations are still in line with your current wishes. And you should make sure to do this once a year so you don’t forget, and end up with the wrong beneficiary listed on your forms when something happens to you.
Far too many people assume that their will is going to be the controlling factor. If, for example, you specify that you want your son to inherit everything that you own, it’s natural to assume that your son is going to be the one who gets the money in your 401(k) or from your life insurance policy after you pass on. Unfortunately, that is not necessarily going to be what ends up happening.
If you named a different beneficiary on your 401(k) or on your life insurance forms, then it could very well end up that the person named on that form is the one who receives the account, since that’s the way the rules work. If you put someone down on this form and didn’t change it, then your intent or desire for your son to get the account is not necessarily going to matter — the form will usually control.
So, say, for example, that you were dating someone and living with them, and you named them as the beneficiary on your 401(k) account — but then you broke up. You might assume your son would get your 401(k) money, but he might not if you had your ex-partner listed on the forms.
Don’t forget to update your beneficiaries in order to protect your legacy
According to NerdWallet, Americans collectively had around $8.9 trillion invested in 401(k)s in the third quarter of 2024. They also had another $15.2 trillion invested in IRAs as of the same time period. That is a very substantial amount of money. Americans may also have a substantial amount of life insurance. In fact, depending on your situation, you may have a policy with a death benefit that pays out hundreds of thousands of dollars or even millions of dollars.
Your retirement plans, life insurance death benefit, and other accounts with designated beneficiaries may be a very important part of your legacy. If you fail to keep them updated, this can create huge problems. You do not want all of this money going to the wrong people, and it is far too easy for that to happen when you fill out a beneficiary form years ago and never think about it again.
That’s why reviewing all of your beneficiary designations once a year is a good idea. You can save your loved ones the hassle of trying to challenge your designated beneficiary — and very likely being unsuccessful — and you can ensure that all of the money and assets that you worked hard to acquire, or paid premiums for, end up going to the people who you truly want them to.
You should make a list of these accounts, adding to it each time you open a new one where you have to name a beneficiary, and then should go through and do your annual check.
Getting help from an estate planning attorney
An experienced estate planning attorney at Levine, Furman & Rubin, LLC can help you to ensure that nothing falls through the cracks with your estate planning that affects your ability to leave a legacy. This includes things like updating your beneficiaries and also making certain that you use the right estate planning tools to effectively control who inherits all of the money and property that you are leaving behind.
To find out more about how an attorney can help with a comprehensive estate plan in which all of your loved ones’ needs are met and all of your assets are protected, give us a call at 732-238-6000. You can also contact us online to schedule your consultation with an East Brunswick estate planning lawyer who can help you.
- 3 Estate Planning Tasks Everyone Should Do Before They Turn 65 - May 28, 2026
- One Estate Planning Task to Add to Your To-Do-List Every Year - March 18, 2026
- 5 Key Factors to Consider When Choosing a Guardian for Your Children - October 12, 2023
