Review and Update Retirement Beneficiaries!
🔄 Review (and Update) Your Retirement Account Beneficiaries
(Because paperwork shouldn’t decide your legacy.)
Death is one of those topics most of us politely avoid. But as my father used to say, “Nobody gets out of this life alive.” And while we’re pretty good about estate planning buzzwords—wills, trusts, medical directives—there’s one critical detail that gets overlooked far too often:
👉 The beneficiary designations on your retirement accounts.
Ignore them, and you may unintentionally leave your loved ones with a financial horror story—no haunted house required.
👻 Why Beneficiaries Matter More Than Your Will
Here’s the uncomfortable truth:
Retirement accounts do NOT follow your will or trust.
They follow whatever beneficiary designation is on file with the plan administrator. Full stop. If it’s outdated, incomplete, or missing altogether, your carefully drafted estate plan may be irrelevant.
Two real-world court cases drive this point home.
⚖️ Case #1: “I Thought My Sister Would Get It”
In Sherry Yali Liu v. Kaiser Permanente Employees’ Pension Plan, a long-time employee verbally promised her retirement benefits to her sister. She wasn’t married. She had no children. She even started the beneficiary designation process online.
But she didn’t finish it.
When she passed away, the plan’s default rules kicked in. No spouse. No children. No dependent.
👉 No inheritance for her sister.
The court ruled that “substantial compliance” wasn’t enough. The plan required every step to be completed. Because it wasn’t, the beneficiary designation was invalid.
Intent didn’t matter. Paperwork did.
⚖️ Case #2: The Ex from the 1980s
In another case, a man named his girlfriend as beneficiary decades earlier—then broke up with her. Life moved on. Jobs changed. He logged into his retirement account many times. He received reminders. But he never updated the designation.
When he died, his retirement account—worth over $750,000—went to his former girlfriend.
His estate argued that the employer should have done more to guide him. The court disagreed.
👉 He had noticed. He had access. He didn’t act.
The old beneficiary stayed.
🚨 The Big Takeaway
These cases highlight one hard truth:
Your beneficiary designations override everything else.
Marriage, divorce, deaths, new children, job changes—all of these require updates.
Moving retirement accounts between institutions? Beneficiaries do not automatically carry over.
Starting a designation but not finishing it? That’s the same as having none.
🧠 A Simple Question to Ask Yourself
If something happened to you tomorrow…
Would your retirement accounts go exactly where you intend?
If the answer isn’t a confident yes, it’s time for a review.
✅ Final Thoughts
Updating beneficiaries isn’t dramatic. It’s not complicated. And it doesn’t take long.
But skipping it can undo years of careful planning and leave behind confusion, resentment, and legal battles.
Peace of mind isn’t just for the living.
It’s part of the legacy you leave behind.
👉 If you’d like help reviewing beneficiary designations as part of a bigger tax and retirement strategy, book a call with Lisa Brugman, EA & Associates. Let’s make sure your intentions—not outdated paperwork—decide the outcome.
