A little over four years ago, we pointed out how important it is to periodically review one's life insurance beneficiary designations. Today, the Wall Street Journal has a similar warning for folks with 401(k) or similar retirement plans:
"If you haven’t updated that paperwork to reflect how your life has changed, you might not be able to leave your wealth to your heirs as you wish. Instead, you could bequeath them a bureaucratic nightmare."
They cite the case of a recently deceased executive who had the bulk of his wealth tied up in his 401(k), but failed to coordinate the beneficiaries with his will. The result was that his wife (widow) of two months stands to gain a great deal, while his kids are left holding the (empty) bag. As the article points out, one's will does not control one's retirement funds' ways.
The lesson? Go review your plans, and update them as appropriate.
Your loved ones will someday appreciate that.