Google | Generative AI
Generated on March 19th, 2025
A contingent beneficiary is a backup beneficiary who inherits assets if the primary beneficiary is unable to, for example, if they predecease you or are unable to accept the inheritance. You likely need a contingent beneficiary to ensure your assets are distributed as intended, even if your primary beneficiary can’t receive them.
Here’s a more detailed explanation:
- Definition:
- A contingent beneficiary, also known as a secondary beneficiary, is the person or entity you designate to inherit assets if your primary beneficiary is unable to receive them.
- Why you need one:
- Backup Plan: If your primary beneficiary dies before you, is incapacitated, or refuses the inheritance, the contingent beneficiary steps in.
- Ensuring Intended Distribution: Contingent beneficiaries help ensure your assets are distributed according to your wishes, even if unexpected circumstances arise.
- Avoid Probate: If you don’t name a contingent beneficiary and your primary beneficiary can’t receive the assets, your estate might have to go through probate court, which can be a lengthy and expensive process.
- Examples of assets where you should name beneficiaries:
- Life insurance policies
- Annuities
- Financial accounts
- Wills and trusts
- Who can be a contingent beneficiary?
- Individuals
- Organizations
- Estates
- Charities
- Trusts
- Important Considerations:
- You can name multiple primary and contingent beneficiaries.
- You can specify how the assets should be divided among beneficiaries.
- If you have minor children as beneficiaries, a legal guardian will need to be appointed to manage the assets until they reach the age of majority.
Generative AI is experimental. For legal advice, consult a professional.
Google | Generative AI | Prompt: “contingent beneficiary definition and do i need one”
