What is a “beneficiar” and how do I choose one?

You’ve seen the movies in which the wealthy uncle dies without leaving any will. There is no beneficiar. The family explodes into chaos and tension that makes the Jerry Springer Show look like a children’s program. You swear you wouldn’t let this happen to your family.

What exactly is a beneficiary? Is there a specific way to choose one? When would you name a beneficiary? It can be difficult to do the right asset disposal relief thing for your family and yourself. We have cut through legal jargon to provide you with the facts you need so that you are confident in choosing your beneficiary.

What is a Beneficiary?

A beneficiary is someone who inherits your stuff after you pass away. This is the basic definition. Here’s the more detailed explanation. A beneficiar is any person or organization (nonprofit, charity) that you name in certain legal documents (like a will and a life insurance plan) to receive all or part of your assets (money or other stuff) upon your death. You can name more than one beneficiary and don’t need to select a relative. These are just a few examples of beneficiaries.

  • A person (or multiple people)
  • You have appointed the trustee for a trust that you’ve established
  • A charity or non-profit
  • Minor (child younger than 18 years old)
  • In the case of life insurance, your estate

Why Beneficiaries are Important?

As the old song says, you work hard to earn your money. You want to be there for your family, and ensure that they are financially secure when you are gone. This is the main reason to name a beneficiar.

These are just a few Beneficiar

  1. Clarity. Some people can become a bit crazy when they are grieving. You might find yourself in a bitter fight with your family members over Aunt Melba’s thimble collection.

Naming beneficiar makes your wishes crystal clear. In most cases, it is legal and ironclad. It keeps the family together at peace so that your next reunion doesn’t end on YouTube.

  1. Speed. Speed. This means that your family will be able to access the funds they require in order to take care of any emergency. They won’t have to spend too much time in probate court. Who wants to spend their afternoons in probate court?

While some assets will still be subject to probate upon your death (like property), naming a beneficiary before your death will speed up the process. The court will have to determine who is legally entitled to your property if you don’t name someone.

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