This month we will be focusing on Beneficiaries, the importance of giving complete and correct information, and updating the information when needed. A beneficiary's personal information may change over the years, and it is crucial to notify us when an update is required. You will also need to inform us when a beneficiary needs to be removed and/or added.
I read this story years ago and wanted to share it. It is called The Pension Pickle*.
A Brooklyn man says he was left destitute when his late wife’s pension, worth nearly $1 million, was awarded to his sister-in-law on a technicality – and is hoping for the state’s highest court to hear his case.
“I lost the best thing that ever happened to me,” said Bruce Friedman, 61, of his late wife, Anne.
The Friedmans were happily married for nearly 20 years when Anne, a former city school principal, died suddenly of a massive heart attack in September 2001.
Friedman said he never doubted he’d be entitled to the lump-sum payment of $900,862 because the Teacher’s Retirement System sent out annual statements that indicated his wife had named no beneficiary.
That would make him, as her closest relative, the beneficiary.
But after she died, officials found a form that had been filled out 27 years prior, four years before the couple met on a 1978 blind date.
It indicated Anne’s mother, uncle and sister should collect.
Anne’s mother and uncle died, so the money was awarded to the sister. Friedman complains that she won’t give him a cent.
“I think Anne would just be shocked,” said Friedman, adding that he’s just making ends meet.
A Manhattan Supreme Court ruling held that Anne’s intention of making her husband the beneficiary could not be assumed and that the paperwork on the file was clear, said Joseph Harbeson of the Corporation Counsel’s office, which is representing the retirement system. “We feel we are complying with the law as it stands.”
The Supreme Court decision was upheld by the Appellate Division in December.
Friedman said he wants to go to the Court of Appeals because “All I know is it’s my last chance.”
Friedman’s lawyer described the decision as “sobering,” and added some advice for all couples:
“Make sure you update your pension beneficiary forms. If you don’t, your spouse and family may wind up with nothing.”
*New York Post, January 31, 2005. Written by: Zach Haberman
At Dixon Financial Group, LLC, we do not want this to happen to your family, friends &/or your favorite charity/s. Therefore, July is Update Your Beneficiaries Month, and we will need your assistance.
For our current clients there are a few options to do this:
- Call the office to review your beneficiaries for each account over the phone.
- Go to your online* investment account/s and make the necessary changes if allowed. This may be with LPL and/or an outside account we may have set up for you. *You will need to have an online account set up before taking this action.
- Make an appointment to review your account/s with David and make any needed changes/updates to your beneficiary list.
- Soon, you can respond to the letter and form we will be emailing so you can update your beneficiary information. The more information we have, the easier it is for us to contact your beneficiaries.
Our goal will be to introduce ourselves to your beneficiaries before they need our services. This way there is a point of contact between them and us when the time comes.
Together we can prevent what happened to Bruce and spare those you care about any additional heartache.
If you are not a client of DFG and this blog has brought up some questions, please contact our office, we would be happy to meet with you and be a part of your financial journey.
David S Dixon, CFP®
As always, if you have any questions, please reach out to our office. We are here to help. To help others, please share this blog post.