# How to name a beneficiary on your accounts

> Name a primary and a backup beneficiary on every retirement account, policy and bank account, and update them after life changes.

Source: https://www.walletprep.com/learn/beneficiaries/ · Updated 2026-10-04 · Protect yourself

A beneficiary is the person you name on an account or policy to receive it when you die, and that form usually decides who gets the money, even if your will says something else. Name a primary and a backup on every account that allows it, and check them after any big life change.

## Key facts
- **The form controls the money.** Money in a retirement plan or life insurance policy goes to the beneficiaries you named on it, no matter whom you name in your will. Joint accounts with right of survivorship go to the surviving owner.
- **Primary and contingent.** The primary beneficiary gets the money if they outlive you. The contingent beneficiary gets it if the primary has died first. Name both.
- **Spouses have rights in 401(k) plans.** In most 401(k) plans, a surviving spouse automatically receives the account. To name someone else, your spouse generally must sign a written consent witnessed by a notary or plan representative.
- **Beneficiary designations skip probate.** Payable on death bank accounts and transfer on death investment accounts pass straight to the person named, without probate. They usually just need a death certificate and ID.

## Which accounts let you name a beneficiary
Workplace retirement plans like a 401(k) or 403(b), IRAs, life insurance, annuities and many pensions all ask for a beneficiary. So can bank accounts, through a payable on death (POD) designation, and brokerage accounts, through transfer on death (TOD) registration.
In some states you can also name a beneficiary for a car or a home with a transfer on death form or deed. Rules vary by state, so check with your state's motor vehicle office or a local lawyer.

## Why the form beats your will
A beneficiary designation is a contract with the bank, plan or insurer. When you die, they pay the person on their form. A will only controls property that doesn't already have a named beneficiary or co-owner.
That is why an out-of-date form causes so much trouble. If your form still names a former partner, the plan may be required to pay them even if your will leaves everything to someone else. Some states have rules that revoke an ex-spouse's designation after divorce, but they don't cover every account, so update the form yourself.

## How to fill out the form
Log in to the account or ask HR for the beneficiary form. For each person, give their full legal name, relationship, date of birth and, if asked, their Social Security number. Make sure the percentages add up to 100%.
Name at least one contingent beneficiary. If you name a trust or a charity, use its exact legal name. Save a screenshot or copy of the confirmation, and tell your beneficiaries where your accounts are.

## Married with a 401(k)
Federal law protects spouses in most workplace retirement plans. The Department of Labor explains that in most 401(k) plans, your surviving spouse automatically receives the account if you die, and choosing anyone else requires your spouse's written consent.
IRAs follow different rules. In community property states, a spouse may have a claim to part of an IRA too. If you want to name someone other than your spouse, ask the plan and a lawyer what's required.

## When to review your choices
Review your forms after a marriage, a divorce, the birth or adoption of a child, or the death of anyone you named. Also check when you change jobs or roll a 401(k) into an IRA, since the new account starts with no beneficiary.
NAIC suggests checking life insurance beneficiaries every few years. A once-a-year check, such as during open enrollment, is an easy habit.

## A worked example: how much skips the will
Alex, 34, has a will leaving everything to his partner. He adds up his accounts to see how much his beneficiary forms control instead.

- 401(k): $48,000
- Life insurance from work: $70,000
- Savings with a POD beneficiary: $6,000
- Passes by beneficiary form: = $124,000
- Checking, no beneficiary: $2,000
- Everything: = $126,000

1. $48,000 + $70,000 + $6,000 = $124,000 goes to whoever is named on the forms. Only the $2,000 in checking follows his will.
2. $124,000 ÷ $126,000 is about 98%. Alex finds that his work life policy still names his sister from before he met his partner.
3. He updates the 401(k) and the policy to name his partner as primary and his sister as contingent, and adds a POD beneficiary to checking.

## Common mistakes
- **Leaving the form blank.** With no beneficiary, the account usually goes to your estate and through probate, which takes longer and costs more. Some plans have default rules that may not match your wishes.
- **Forgetting an ex on the form.** Divorce doesn't always change a beneficiary designation. Check every account after a divorce or breakup and replace the name yourself.
- **Skipping the contingent beneficiary.** If your only beneficiary dies before you, or with you, the money may end up in probate. A backup name prevents that.

## Questions people ask
### Does a beneficiary override a will?
Generally yes. Life insurance, retirement accounts and POD or TOD accounts pass to the named beneficiary regardless of the will. A will covers property without a beneficiary or co-owner.

### Can I name more than one beneficiary?
Yes. You can name several primary and contingent beneficiaries and set a percentage for each. The percentages for each level must add up to 100%.

### Can I name my estate as beneficiary?
You can, but it sends the money through probate, where creditors can make claims and the process takes longer. Naming people or a trust is usually faster for your family.

### Do beneficiaries pay tax on what they inherit?
Life insurance paid because of a death generally isn't taxable income, according to the IRS. Money from a traditional 401(k) or IRA is usually taxed when the beneficiary withdraws it. Rules depend on the account and the beneficiary.

### How do I find out who my beneficiary is?
Log in to each account and look for a beneficiaries section, or call the plan, bank or insurer. Ask HR about workplace retirement and life insurance plans.

## Do this today
List every retirement account, life insurance policy and bank account you have. Log in to each one, check the beneficiary section, and add or fix a primary and a contingent beneficiary with shares that add up to 100%.

## Sources
- [U.S. Navy JAG: Wills and basic estate planning](https://www.jag.navy.mil/legal-services/rlso/wills-and-estate-planning/)
- [U.S. Department of Labor: FAQs about retirement plans and ERISA](https://www.dol.gov/sites/dolgov/files/EBSA/about-ebsa/our-activities/resource-center/faqs/retirement-plans-and-erisa.pdf)
- [Investor.gov: Transferring assets](https://www.investor.gov/additional-resources/information/seniors/transferring-assets)
- [NAIC: Tips to help you buy life insurance](https://content.naic.org/article/consumer-insight-want-purchase-life-insurance-here-are-tips-help-you-through-process)
- [CFPB: What happens if I have a joint bank account with someone who died?](https://www.consumerfinance.gov/ask-cfpb/what-happens-if-i-have-a-joint-bank-account-with-someone-who-died-en-1101/)
- [IRS: Life insurance and disability insurance proceeds](https://www.irs.gov/faqs/interest-dividends-other-types-of-income/life-insurance-disability-insurance-proceeds)

_General education, not personalized financial, tax or legal advice. Figures are examples. Check current rates and limits before you act._