Named Beneficiary

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Definition of 'Named Beneficiary'

A named beneficiary is a person or entity that is designated to receive the benefits of an insurance policy, retirement plan, or other financial account upon the death of the account owner. The named beneficiary is typically specified in the contract or other documentation associated with the account.

There are two main types of named beneficiaries: primary and contingent. The primary beneficiary is the first person in line to receive the benefits of the account. If the primary beneficiary dies before the account owner, the contingent beneficiary will receive the benefits.

It is important to designate a named beneficiary for your financial accounts. This will ensure that your assets are distributed according to your wishes, and it will avoid any potential conflicts or confusion. If you do not have a named beneficiary, your assets will be distributed according to the laws of your state.

Here are some tips for choosing a named beneficiary:

* Consider your personal circumstances and goals. Who would you like to receive your assets if you die?
* Make sure the beneficiary is someone you trust.
* Update your beneficiary designations regularly, especially if your circumstances change.

Naming a beneficiary is a simple but important step that can help to ensure that your assets are distributed according to your wishes. By taking the time to designate a named beneficiary, you can help to avoid any potential conflicts or confusion after your death.

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