Sugar Land residents who are looking for a divorce may be interested in some information about changing the beneficiary on accounts. The process is straightforward as long as the timing and method of changing the beneficiary are appropriate.
One of the main things that people often do after a divorce is to remove their former spouse’s name as beneficiary on various assets, including insurance policies and retirement accounts. Because you generally cannot make this type of change to an account once the divorce process has begun, it is usually appropriate to wait until the divorce is finalized. While the change can be made before the divorce is filed, this may result in the former-beneficiary spouse being alerted to the change. This may bring up unwanted questions about the reasoning behind the change.
Some people try to avoid changing each individual beneficiary's name by amending their will to reflect the new beneficiaries. However, this may not be valid, as the named beneficiary on the account is generally going to supersede whatever is in the will. Some state laws, however, are allowing insurance policy and retirement account administrators to be flexible with who they use as the beneficiary. When there is evidence of a divorce or death, the administrator may be able to use the secondary beneficiary on the account.
The best method is usually to change the beneficiary on each account individually. While more time-consuming, this is the surest way to have those assets go to someone other than a person’s ex-spouse. This is just one of many divorce legal issues that people must deal with in a high-asset divorce. An attorney may be helpful in explaining how a divorce can affect other assets, such as stock options and real estate holdings.