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Legal Notes: Beneficiary Designations...Sometimes the harder choice may be the better choice

Attorney Lisa L. HalbertAttorney Lisa L. Halbert, Northampton, 413-584-1287As I sit to write this article, I am considering: what would I, as a reader, want to know that might not seem terribly obvious...but can be useful if considered?

Typically, most spouses automatically name the other spouse as a beneficiary, whether on life insurance, individual retirement accounts, and/or annuities, and never revisit the designations. Most people want to know that the surviving spouse will be provided for upon the death of the first to die. But consider this: If, upon serious reflection, you knew that your spouse was no longer going to be able to safely reside in the marital home or marital apartment alone and without you present, would you still leave the surviving spouse those same monies?

For example, spouses Alex and Pat have lived in the community for decades, and appear to be happy and healthy. The reality, however, is that 60 years into their marriage, where Alex is healthy as a horse, Alex has also become a caretaker to Pat. Pat cannot safely cook, might be very confused if there was a fire, and might not really know how to call emergency services should the issue arise. We all know someone like Pat. You know, that person who when a question is asked provides a very friendly response, but upon second or third thought the response is quite non-committal and vacant. Alex, having lived with Pat for decades and done some soul-searching, is absolutely confident that if something were to happen to Alex, Pat would likely need to move into a long term care facility or nursing home. And in fact, this same conversation has occurred between Alex and Pat’s doctor.

If, upon serious reflection, you knew that your spouse was no longer going to be able to safely reside in the marital home or marital apartment alone and without you present, would you still leave the surviving spouse those same monies?

If Alex keeps Pat as the designated beneficiary on all accounts (such as life insurance, individual retirement, and/or annuities) and Alex unexpectedly dies first, then all of these same monies would be paid to Pat. If Pat then requires nursing home care, it is quite possible that much of these same monies might be paid for care in a nursing home, and not really available to Pat to spend as desired. Under these circumstances, perhaps instead of leaving funds to Pat, Alex might want to consider changing the designated beneficiary and leave the same funds to other family or friends, or perhaps even a non-profit such as LifePath, or other similar organization. (Or split the designation with some percentage left to Pat and the balance left to other/s.) Maybe if other family members are named, those individuals might decide to make some monies available for Pat to have a few indulgences without risking all of the monies. (There is no guarantee that family members will do this, so please think about your own situation and evaluate it.)

Is this appropriate in every case of a beneficiary designation? Absolutely not! But trust your instincts and periodically consider the consequences of your beneficiary designations.

Attorney Lisa L. Halbert practices law with the regional firm of Bacon Wilson, P.C. Lisa focuses her practice on all aspects of asset protection, including estate, tax, and long-term care planning, together with matters related to trusts and estates, probate, guardianship, and conservatorship. Lisa works primarily from Bacon Wilson’s Northampton location, and may be reached at 413-584-1287, or via email at This email address is being protected from spambots. You need JavaScript enabled to view it..

The views expressed in this column represent general information. To address your particular and specific needs, consult your own attorney. If you need help with referral to an attorney, contact the Franklin County Bar Association at (413) 773-9839 or the Worcester County Bar Association at (978) 752-1311. Elder law resources may be found through the National Academy of Elder Law Attorneys, Massachusetts Chapter, at massnaela.com or 617-566-5640.

Community Legal Aid (CLA) provides legal services free to people age 60 and older for civil legal matters with an emphasis on access to health care coverage (MassHealth and Medicare) and public benefits, as well as tenants’ rights. A request for legal assistance can be made by phone at 413-774-3747 or toll-free 1-855-252-5342 during their intake hours (Monday, Tuesday, Thursday, and Friday from 9:30 a.m. to 12:15 p.m. and Wednesday from 1:30 p.m. to 4:15 p.m.) or any time online by visiting www.communitylegal.org.