CAREFUL CONSIDERATION NEEDED WHEN NAMING YOUR BENEFICIARIES

                         Roanoke Times
                 Copyright (c) 1995, Landmark Communications, Inc.

DATE: SUNDAY, February 14, 1993                   TAG: 9302120319
SECTION: INSURANCE                    PAGE: INS-2   EDITION: METRO 
SOURCE: 
DATELINE:                                 LENGTH: Medium
CAREFUL CONSIDERATION NEEDED WHEN NAMING YOUR BENEFICIARIES
Life insurance policies, pension plans, IRAs . . . all require that you name a beneficiary. Many people don't give the process much thought, simply naming a spouse and/or children and then putting the whole thing out of mind.
But choosing your beneficiary, and keeping that choice up to date, is important. Here are some of the things to consider:
Don't stop at naming a single beneficiary. Always name a "contingent" or secondary beneficiary as well, just in case you outlive your first beneficiary.
Make a specific election, rather than having the proceeds of your life insurance paid to your estate. One of the great advantages of life insurance is that it can be paid to your family immediately, without delay. If it is payable to the estate, however, it will have to go through probate along with the rest of your assets and your family will have to wait to receive the proceeds.
Think very carefully about the wording of beneficiary designations (your insurance agent can help you here). Saying "wife/husband of the insured" without a specific name could restful in an ex-spouse received the proceeds. Similarly, naming "Mary, wife of the insured" may create a problem if, at the time of your death, you're actually married to "Susan." Changing the beneficiary designation is easily accomplished, but you have to remember to do it.
Naming specific children may mean that later-born children will be left out unless the beneficiary designation is changed. Saying "children of the insured, John Smith," might mean that your wife's child from a previous marriage, whom you meant to include, is in fact excluded. Saying "children born of the marriage of John and Susan Smith" may mean excluding adopted children. Think it through very carefully, so that you actually do what you mean to do.
Decide, too, how proceeds should be distributed if one of your children dies before you do. If you then want the proceeds to go to that child's children, you must say so. You must also decide how much grandchildren will share in the proceeds with your other children, whether everything will be divided equally or whether the grandchildren will split what would have been their parent's share.
It is very important to anticipate as many situations as possible. It's also vitally important to review your beneficiary provisions regularly. Unless you make an irrevocable designation, as might be the case in a divorce settlement, you can change beneficiary designations as often as you like. You won't want to change frivolously, but you should change when its appropriate to do so.

by Archana Subramaniam by CNB