Spouse—the choice of most married couples. If you should die and your spouse is the primary beneficiary, he or she can roll the money from your 401(k) plan into a traditional IRA. This is available only to a spouse. There will be no tax due on the money (and earnings continue to build up tax-deferred) until a distribution from the spouse's IRA is made.
IMPORTANT NOTE: To name a beneficiary other than your spouse, you and your spouse will have to complete a beneficiary designation form. Your spouse's signature consenting to this must be notarized.
IMPORTANT NOTE: If your spouse is not a U.S. citizen, certain restrictions may apply.
Children—usually named as secondary beneficiaries (If the primary beneficiary dies, then the secondary beneficiary will inherit the money.)
Parents—the choice of most single people. But, if you are single and have a child, your child would likely be the first choice. Your decision may depend on the ages of your parents and your child.
Relatives—usually chosen if you have no other family members listed above.
IMPORTANT NOTE: It is recommended that you review your beneficiary selections periodically. Revisit your beneficiary selection when there is a change in your family status.
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