Ask Terry Questions Beneficiary of life insurance policy from employment

Beneficiary of life insurance policy from employment

By Terry Savage on November 08, 2022 | Insurance & Annuities

Should the beneficiary of a life insurance policy from employment be a trust or is it better to specify specific individuals to be the beneficiaries?

Terry Says

Have you made a Revocable Living Trust as your estate plan? If so, name the trust as beneficiary so the finds can be distributed by the successor trustee as you direct in your instructions.
But if you don’t have a RLT, then name a beneficiary (and a secondary beneficiary in case the first predeceases you or dies in an accident with you).
There is no tax issue, as the payment should come to your heir tax-free.

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