Having a will doesn’t necessarily control everything.
Your will does not override a 401(k), IRA, or life insurance beneficiary designation. If an ex-spouse is still listed on your retirement portal, they get every penny—regardless of what your will says.
WHAT IS THIS?
Financial accounts with designated beneficiaries pass by operation of contract, completely bypassing probate court and your will.
When you opened your bank account, brokerage, 401(k), or life insurance policy, you signed a contract with that financial institution.
That contract states that upon your death, the institution transfers ownership directly to whoever is named in their system. The probate judge and your will have zero jurisdiction over that transfer.
WHY SHOULD I CARE?
In Supreme Court cases (such as Kennedy v. Plan Administrator), judges have repeatedly ruled that employers MUST pay the named beneficiary on the plan documents, even when a divorce decree explicitly waived rights to the money.
WHAT SHOULD I DO?
Audit all five major account portals this weekend and list primary and contingent beneficiaries.
WHAT TO DO NEXT
ACTION RULEYOUR 5-MINUTE CHECKLIST:
- Log into 401(k) / IRA portals.
- Log into primary bank account and verify POD.
- Verify contingent beneficiary names.
“Whenever you marry, divorce, have a child, or buy a home, update your online beneficiary portals on day one—do not assume your will takes care of it.”
- •Kennedy v. Plan Administrator for DuPont Savings(Supreme Court of the United States (555 U.S. 285))
- •Employee Retirement Income Security Act (ERISA)(U.S. Department of Labor)
HOW MUCH OF ADULT LIFE CAN YOU HANDLE WITHOUT GOOGLING IT?
Download The “I Should Probably Know This” Checklist. 50 things every adult should know how to find, check, understand, or do across Money, Cars, Home, Life Admin, and Preparedness.
RELATED FIELD MANUALS
Your credit card shows two balances. Which one do you actually pay?
Current Balance vs. Statement Balance. Paying the wrong one either costs you accidental interest or wastes cash flow you didn't need to surrender yet.
Actual Cash Value vs. Replacement Cost: The fine print on your policy.
If your 8-year-old roof or 5-year-old television is destroyed, ACV pays what a used, depreciated item is worth on Craigslist. Replacement Cost pays what it costs to buy a brand new one today.
The 72-Hour Water Rule: How much you actually need.
When municipal water is contaminated or the power grid goes down, grocery store shelves empty within 2 hours. One gallon per person per day is the biological baseline.