{"id":749,"date":"2019-06-06T14:44:00","date_gmt":"2019-06-06T14:44:00","guid":{"rendered":"https:\/\/mgfs.net\/?p=749"},"modified":"2021-10-05T20:51:10","modified_gmt":"2021-10-05T20:51:10","slug":"beneficiaries-two-words-that-can-drastically-change-your-estate-plan","status":"publish","type":"post","link":"https:\/\/mgfs.net\/blog\/beneficiaries-two-words-that-can-drastically-change-your-estate-plan\/","title":{"rendered":"Beneficiaries: Two Words That Can Drastically Change Your Estate Plan"},"content":{"rendered":"\t\t
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Beneficiary designations might appear to be a simple option for your life insurance and retirement\/investment accounts, but they can easily become complicated. It could also mean you are disinheriting certain family members, even if it wasn’t intentional.<\/p>

The two ways your heirs can inherit your assets are “per capita” and “per stirpes,” both Latin terms that might leave some befuddled.<\/p>

Per Capita<\/h3>

When you designate your beneficiaries, the default option is “per capita” which means “by heads.” Simply put – if you have 3 children, and you designate them as beneficiaries to receive 1\/3 each, that is what they receive if they are all still living upon your death. If one of them passes away before you, leaving two surviving beneficiaries, those two will receive 1\/2 share each. More often than not, a beneficiary form or account application won’t even mention this, or it’s buried in the fine print. Hopefully, this is something your advisor or attorney is discussing with you.<\/p>

Per Stirpes<\/h3>

The other option is “per stirpes” which\u00a0is Latin for “by representation” or “by class.”<\/p>

Let’s say you have 3 children named Mick, Keith, and Charlie, and each of them have kids (your grandchildren). They are your three beneficiaries and in the event of your death, each receive equal 1\/3 share. Charlie passes away, but has a surviving spouse and children. If you don’t have “per stirpes” listed on your beneficiary designations, and only have Mick, Keith, and Charlie listed as equal shares, your money will be divided equally between Mick and Keith, 50\/50, leaving out Charlie’s family.<\/p>

If you had “per stirpes” on your beneficiaries, even though Charlie has passed, his 1\/3 share would go to his children. It essentially follows the lineage, and ensures that each “family” receives their 1\/3 portion of the inheritance. If Charlie has two living children, they will split Charlie’s 1\/3, or receive 1\/6 each.<\/p>

Bottom Line<\/h3>

Ultimately, it is up to you and what your objectives are, and who you want to receive your assets at your death. While we plan for the unexpected, we also have to plan for other contingencies should they happen. This is a very important conversation that we always have with our clients. If you have questions about whether or not your beneficiaries are aligned with your estate plan, please contact us for an estate plan review!<\/p>

*This information is not intended to be a substitute for specific individualized tax or legal advice. Moschel-Ghan Financial Services nor its advisors do not offer tax or legal advice. As with all matters of a tax or legal nature, you should consult with your tax or legal counsel for advice.<\/em><\/p>\t\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t<\/section>\n\t\t\t\t<\/div>\n\t\t","protected":false},"excerpt":{"rendered":"

Beneficiary designations might appear to be a simple option for your life insurance and retirement\/investment accounts, but they can easily become complicated. It could also mean you are disinheriting certain family members, even if it wasn’t intentional. The two ways your heirs can inherit your assets are “per capita” and “per stirpes,” both Latin terms […]<\/p>\n","protected":false},"author":5,"featured_media":756,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[1],"tags":[],"_links":{"self":[{"href":"https:\/\/mgfs.net\/wp-json\/wp\/v2\/posts\/749"}],"collection":[{"href":"https:\/\/mgfs.net\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/mgfs.net\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/mgfs.net\/wp-json\/wp\/v2\/users\/5"}],"replies":[{"embeddable":true,"href":"https:\/\/mgfs.net\/wp-json\/wp\/v2\/comments?post=749"}],"version-history":[{"count":0,"href":"https:\/\/mgfs.net\/wp-json\/wp\/v2\/posts\/749\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/mgfs.net\/wp-json\/wp\/v2\/media\/756"}],"wp:attachment":[{"href":"https:\/\/mgfs.net\/wp-json\/wp\/v2\/media?parent=749"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/mgfs.net\/wp-json\/wp\/v2\/categories?post=749"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/mgfs.net\/wp-json\/wp\/v2\/tags?post=749"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}