One of the most important financial moves you can make is to take the time to name your beneficiaries for your UNC Optional Retirement Plan and/or Supplemental retirement accounts. If no beneficiary is named for each of your accounts, the money will typically go through probate court before it’s distributed to your heirs according to your will (or according to state law if you have no will). The fastest, most efficient way that will cause the least amount of frustration and to ensure the people and organizations you love have access to your retirement funds, is to name them as your beneficiaries.
Primary and Contingent Beneficiaries
Your primary beneficiary is the person or entity that first receives the proceeds of your account upon your death. As the owner of the account, you have the authority to select a single or multiple beneficiaries and designate their specific shares of the proceeds. Beneficiaries can include individuals such as family members or friends, charitable organizations, trust you have established for your estate-planning, or your estate.
Contingent beneficiaries are the named beneficiaries that will receive your account proceeds in the event that your primary beneficiary predeceases the account holder.
Why does naming a beneficiary matter?
- It gives you another way to control your estate by letting you choose the amount you assign to each beneficiary
- It can help you leave a legacy and pass wealth on to the future generations when you name grandchildren to be contingent beneficiaries and help cover important expenses like college education costs, the down payment on a house and more.
- It ensures the money in your account won’t end up as part of your estate and have to go through probate court if something happens to your primary beneficiary before the account is dispersed
Have a Conversation with your Beneficiaries
Conversations with your loved ones about death and loss are never easy but talking to your primary and contingent beneficiaries now can help reduce hours of frustration in the future when they are trying to track down account details and paperwork after you are gone.
- Frame it as part of a larger story. When it comes to your estate, it’s important to talk about each asset as part of your total estate gameplan. Create an overview file that includes all of your account details to help facilitate this conversation and making it easier on everyone
- Don’t sweat the small stuff. You don’t need to talk about account values or others named as beneficiaries if you think it could potentially cause friction
- Know your audience. Talk through difficult topics in a way that feels right for you and your beneficiaries when you have these conversations with a spouse, child, or grandchild
Information You Need to Update Your Beneficiaries
You will need some basic information to add or update your beneficiaries to your TIAA account.
- Your TIAA account log-in and password
- Beneficiary name and relationship
- Beneficiary Date of Birth and Email
- Beneficiary SSN (optional)
To update your beneficiary with TIAA, click here. You can find more details in TIAA’s The Importance of Beneficiary Designations by clicking here.