Beneficiary / Contingency Percentage Question

Retirement
1

A Question to the smart folks -
IF I want to assign my (2) beneficiaries as

  1. Primary - each having a 50% share of the total
  2. Contingency - if something happens to one of them, the other will get 100%

Would this be assigned as
Primary Person A 50%
Contingency Person A 100%

Primary Person B 50%
Contingency Person B 100%

I have no idea why this is so hard for me - except I am getting old (my go-to excuse)
TIA

2

No you just specify the two Primary and that’s it, but … if one of the Primaries passes before you do their heirs will get the $$$ if inheritance is “per stirpes” but not if it’s “per capita”. So the real question is if you don’t want the money going to one of their heirs you have to pay attention to what you do. Note I am not a lawyer, this is not legal advice, consult a licensed and qualified attorney. I’m 61 BTW hope you’re not younger than me! Age would not be a valid excuse!

Definitely make sure all of your beneficiary designations for your retirement accounts and your life insurance and annuities are all cleaned up or else bad things could happen. Beneficiary designations get executed separately from a Will, so a Will won’t “fix” any problems with the designations.

3

Yes I am LOTS older than you -

This is what it says - I have broken up the sentences for clarity -

If any primary or contingent beneficiary dies before I do, his or her interest and the interest of his or her heirs shall terminate completely,

and the percentage share of any remaining beneficiary(ies) shall be increased on a pro rata basis*.

If no primary beneficiary(ies) survive(s) me, the contingent beneficiary(ies) shall acquire the designated share

Sounds like “per capita” to me - what’s your take ?
I appreciate your knowledge - lawyer or not - You young whipper-snapper -

4

I believe you want Per Capita.

5

I agree with what’s been said generally about per stirpes and per capita but, like a lot of legal issues, it all depends. If this is in a will, check your state law as it may define terms a bit differently or make presumptions one might not expect or even require certain language. If this is a beneficiary of a financial account, you need to speak with the holder about how they handle death of a primary beneficiary and how they allow the naming of beneficiary. Again, each place seems to do it a bit differently.

This is a simple explanation of the terms used in a will.

6

Thank you both, jimtoo and ochotona - you have both answered my question very well. Yes, the Per Capita works exactly as I want in this investment.