How To Name Inheritors And Beneficiaries
When creating a Will, you have the right to give your assets or property to whomever you choose.
A person or organization you leave your assets to is known as a beneficiary. You can name any person, family member, friend, organization, or institution as a beneficiary. The only person you can't name as a beneficiary is a person who serves as a witness to the signing of the Will.
If you name multiple beneficiaries in your Will, you’ll need to decide how the assets will be distributed among those beneficiaries. Some common methods of distribution are:
- To distribute assets equally among beneficiaries
- To distribute assets unequally among beneficiaries (e.g. 25% to your brother, 75% to your sister)
- To stipulate that certain pieces of property go to certain people
- To leave a portion of your estate to be divided equally among a group of people, and also specify that the remainder be distributed in specific amounts to other people or organizations
- To specify that all your assets should be sold and the profits from those sales be distributed equally or unequally among beneficiaries
If you are naming multiple beneficiaries it’s a good idea to consider the assets that you’ll be giving and the ways in which the distributions of those assets might play out. For example, if you leave a piece of real estate to multiple children with each child holding an equal share, think about what happens if one child wants to sell the property and another child does not. Or, if you leave valuable art or family heirlooms to multiple children to be divided equally, consider that the children might be forced to sell the property in order to fairly distribute the value among them. If these are concerns for you, it might be a good idea to consult an attorney who can help you think through these issues and craft the most appropriate language for your situation.
Minor Children As Beneficiaries
You may name minor children (under the age of 18) as beneficiaries in your Will. However, until those children become 18 years old, they will not directly receive any assets you designate for them. The assets you leave to minor children will need to be put into a Trust (which you can establish in your Will) and will be managed by the Trustee of that Trust, who may be either the child’s “Guardian of the Person” or “Guardian of the Estate.” In this way, minor children can receive the benefits of distributions from the Trust but will not themselves control those distributions.
Pets As Beneficiaries
You cannot leave assets to an animal directly. Instead, you may include a provision in your will that accounts for the care of any pets you own. In order to provide for care for pets, you will also need to name a caretaker for those animals. Any money that you designate for your pets will be given to the caretaker to be used for care for the animals. This can also be accomplished by setting up a Trust with the sole purpose of providing funds to care for your pets after you’re gone. [For more information on this, check out our article: How To Make Sure Your Pets Are Taken Care Of After You’re Gone]
If you decide you would not want to leave assets to someone in your family—particularly, one of your children—who may have a legal right to inherit your estate, you need to explicitly state it in your Will. (All states allow for wills to disinherit children, except for Louisiana.) However, it's not sufficient to merely leave a child’s name out of your Will or fail to mention a child as a beneficiary of your estate; if you want to disinherit a child, you must specifically state that the child is to receive no distributions from your estate.
The most effective way to disinherit a child is to acknowledge in writing the existence of the child and then state that you are making no provisions for that child as a beneficiary. Alternately, some lawyers recommend leaving a very small amount of money to the disinherited child so that it’s clear that the child was not accidentally left out of the Will.
Communicating With Your Family
Whatever arrangements you choose to make in terms of naming beneficiaries and distributing your assets, it's a good idea to have a conversation with your family about the arrangements you've made. By talking openly about your decisions with your family members or other people you've named as beneficiaries in your Will, you can help your family avoid surprises, disappointments, and conflict. If you've made choices that you think your family might disagree with, talking about the choices you've made can offer you an opportunity to explain your reasons for making these decisions, which can hopefully help your family avoid conflict in the future.
To learn about who may have a legal right to inherit your property, see our article Understanding Inheritance Rights.
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