People in Massachusetts thinking about their future may consider their wills, trusts and other estate documents, but they may not turn their attention to the company benefit plans that they often signed up for on their first day of work. These benefits can be considerable, including life insurance, retirement funds, stock option plans and other accounts. In many cases, people designated their beneficiaries only once: when they first signed the documents establishing their new accounts. However, the decisions made about beneficiaries can play an important role in a person’s overall estate plan.

When people draw up wills and trusts, they may consider how they want to distribute their assets. It is important for them to remember that their retirement accounts and related funds typically do not pass as an asset through probate on the owner’s death. Instead, they pass using the beneficiary designation, directly to the person named as the beneficiary. This type of transfer also applies to items with joint ownership with a right of survivorship, such as many homes. In order to make sure that what actually happens after a person dies is consistent with their plans, they may need to update their beneficiaries.

For example, a person may have named their spouse as a beneficiary but since divorced; in other cases, they named their parents as the beneficiaries but are now parents themselves. Failing to change the beneficiary documents can lead to unexpected outcomes. In general, it is easy to change these designations; account holders can simply request a form from the company managing the accounts.

Seemingly small choices like beneficiary designations can have a major impact on how a person’s most important assets are disbursed. An estate planning attorney might provide advice and guidance on the management of existing assets as well as the creation of estate documents.