Beneficiary forms

[Guest Chris O'Daniel]

We are in the process of changing our 401(k) vendor. Our new vendor does not want to recieve beneficiary forms. What requirements are there for maintaining beneficiary forms. Do I have to review them? or will state law apply if an ineligible beneficiary is selected?

[Guest Dook]

The Plan Administrator carries the responsibility of providing beneficiary designation forms to each participant, as well as collecting and maintaining these records.

Reviewing them, though not required, is a good idea to avoid disputes and difficulties should the Plan have to pay a claim. These disputes may arise from the naming of multiple beneficiaries but not indicating any allocation percentages or, not providing an address for contacting, etc. A quick review can reveal some of these obvious oversights.

As for ineligible beneficiaries, if you are talking about non-existent people, pets, things like that if th person is not married it would just go to their estate. If you are talking about a non-spouse beneficiary that the spouse has not waived their rights for, then the REA sections of ERISA will require that the spouse is the true beneficiary.