Whom Should I Name As a Beneficiary of an IRA or 401(k)?
If you think a will or trust will ensure that your IRA or 401(k) assets go to the person you want after your death, think again. The beneficiaries you list on these accounts will take precedence over your will or trust, and that means if you're not careful, a big chunk of your savings could end up in the wrong hands.
IRA and 401(k) plans that list beneficiaries won't go into probate but instead will pass directly to the beneficiaries. If the beneficiary is a spouse, then the spouse can treat the inherited accounts as if they were his or her own. Non-spouse beneficiaries will have the assets put into an inherited IRA, with the amounts received being dictated by the percentages listed on the beneficiary designation form.
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Source: Fool.com
