When should I review my life insurance beneficiaries?

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When should I review my life insurance beneficiaries?

Term life insurance lasts for a long time – the shortest term available for most policies is ten years, which officially means that life insurance terms are measured in decades. A lot can happen in a decade. For example, the first iPhone was released less than ten years ago, and look how much the world has changed since then! Now, we have bigger iPhones.

When you first bought your life insurance policy, you had to name some beneficiaries. Over the lifetime of your policy, your relationships with those beneficiaries may change. For example, your wife or husband may become your ex-wife or ex-husband. Your kids may decide to join a biker gang. Maybe you just want to leave it all to your dog.

So it’s prudent to sit down every once in a while and review your beneficiaries so your death benefit ends up in the hands (or paws) of the ones who truly deserve it. There are some obvious life-changing events – marriage, divorce, having kids, buying a house – that everyone else talks about, so we decided to go over some of the less talked about life events that may inspire you to review your life insurance beneficiaries.

You disown your kids

Listen, sometimes kids do stupid stuff that makes you never want to talk to them again, like drop out of Yale or set your car on fire and dance around it, naked, while it burns to a crisp. In this situation, you might to want to consider taking your kids off your life insurance policy. Maybe a charity or your church could use that money instead?

Your estranged kid has a kid

Let’s say that child you "respectfully disagree with about their lifestyle choices" has a child. You could indirectly support your grandchild by naming your regular child the beneficiary of your life insurance policy, but if you don’t trust them to actually use that money for the grandchild, you can just the name the grandbaby the beneficiary instead by setting up a trust.

You adopt a pet

Whether you have a dog or a cat or a lizard or a fish or a pile of bugs in a jar or a frog or a bird or an ant farm, the human capacity to love an animal knows no bounds. You can name your pet as the beneficiary to a life insurance policy, though technically you’ll have to set up a trust to take care of the cash. As we all know, Fluffy just can not be trusted with money.

You're about to undergo a major surgery

Things go wrong during surgeries sometimes, and for a lot of people, it’s a good time to reflect on life. What does it all mean? you might ask yourself. Should I really name my husband my life insurance beneficiary? is another question you could be wondering.

Your spouse or your kids join a cult

Everyone has that random cousin in a cult somewhere in Colorado, exploring nature through vision quests and showing up every few years to ask for money. If this happens to your spouse or your kids, consider cutting them out of your life insurance policy. That money is just going to go into the cult and be wasted on marijuana, beaded curtains, and all-natural soaps.

You join a cult

Obviously, if you join a cult, you’ll want to name either the cult or the cult leader as the beneficiary.

So, how do you change beneficiaries?

The fastest way to do it is to call up the service department for your policy and request a change. You might have to fill out and submit a form. Even if you die before they process the form, as long as you’ve submitted it in good order, they’ll honor the change.