If you remarry you might disinherit your kids

12 Nov 2022 · 1 min

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The speaker warns that people who have a 401(k) and change the beneficiary to their children after a divorce or widowhood can unintentionally disinherit those children if they later remarry. A little‑known rule in retirement‑account law gives a surviving spouse the right to receive the account’s benefits even when the account holder has previously named the children as beneficiaries. The video explains why this happens, emphasizes the need to review and possibly update beneficiary designations after remarriage, and urges viewers to take proactive steps to ensure their intended heirs receive the funds.

Chapters

If you get remarried and you're not careful, you could disinherit your children. This has actually happened and you need to make sure it doesn't happen to you. Pay attention because you're married and you have a 401 with your company. Your spouse is named as your beneficiary of that 401. Then your spouse dies or you become divorced. After that, you decide to make your kids the beneficiaries of that 401 and then you remarry. There's a little-known rule relating to retirement accounts. It says your surviving spouse will receive those benefits even if you've named beneficiaries. This is a common scenario that you have to watch out for. You have kids and you become widowed or divorced, you automatically change your beneficiaries to the kids. But that makes no difference if you remarry and your spouse survives you. In that situation, the surviving spouse will receive those retirement funds, not your kids as you had intended.