What Happens to a Beneficiary’s Share of the Estate If the Beneficiary Passes Away?

If parents create wills naming contingent beneficiaries as their two adult children, there is always the possibility that the adult children will pass away before the parents.

This can have implications for the contingent beneficiary’s share. Language of the created will impacts what happens with each beneficiary’s share. Some wills allow the surviving sibling to receive the entire estate with the remainder getting divided among any living children.

However, the more common strategy for accomplishing these planning goals is to use a per stirpes. This language in a will means that if a child passes away before the testator and this child has surviving descendants, that pre-deceased child’s share goes to the descendants.

If your assets are inside a trust or life insurance policy, then the naming of a contingent beneficiary ensures that there’s a plan to pass on those assets to someone else. Make sure you review your contingent beneficiaries and backup plans on a regular basis.

You can always discuss the specifics of your estate planning strategy directly with your lawyer to verify that this covers your intended goals and plans. If you don’t yet have a plan for what to do with your backup beneficiaries, an estate planning lawyer can give you the support you need.

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