Identifying Your Beneficiaries

The second step in developing an effective estate plan is to know exactly who you're planning for. In legal parlance, these people are often referred to as the "objects of your bounty."  For our planning purposes, though, we'll simply refer to these people as the "beneficiaries" of your estate.

The beneficiaries of your estate may seem rather obvious to you, and most of the time they really are. If you're married, then your spouse may be the primary beneficiary and your children may be alternate or contingent beneficiaries. If you're not married or if your spouse does not survive you, then your children may be your primary beneficiaries. If you're not married and have no living children, then the "natural objects of your bounty" may be surviving descendants, other relatives, friends, neighbors, fellow employees, a church or other charitable organization - it's entirely up to you.
 

Although your intended beneficiaries might seem obvious to you, there are many instances where it might not be.  For example, you may be providing a certain amount of financial support to a parent or even a sibling. You may also have pledged a certain level of support to a church or other charitable organization that's on-going. If that's the case, then you should decide whether the support you provide for these "objects of your bounty" should be continued after your death or disability. If so, then your estate planning would also include these individuals and/or organizations.

We have not developed a workbook specifically aimed at identifying your beneficiaries.  That's because you will have ample time to identify your beneficiaries in step 4 (Developing a Plan of Action).  Still, you should take the time now to identify your intended beneficiaries.  To the extent possible, you should also determine the type of benefit you wish to provide for each of your intended beneficiaries. For example, you may want your spouse to get all of your property, plus you may want your spouse to continue receiving the same amount of income that you provided prior to your death or disability. You may also want to provide enough money to pay for your childrens' college education.  And, you may want to give each of your brothers and sisters a gift of money for no particular reason other than the fact that they are your brothers and sisters.  This information will be recorded on the workbooks provided in step 4.

With that said, it's time to go to the workbook entitled, "Setting Your Goals and Objectives."

 

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