What should I do with the beneficiary forms my employer gave me for my 401k if I have a will?
The short answer: Fill out the form, hand it in, and make sure it's up-to-date if you ever have any life changes.
If someone passed away, "Qualified" assets such as money from a 401k would pass by the beneficiary designation and would not go through the Will. Therefore, you should definitely submit the beneficiary form and list both a primary and contingent beneficiary for your 401k plan. By submitting and maintaining the form, you're helping your heirs avoid unneeded confusion. In addition to the form, you should coordinate with your tax or legal advisor so that the distribution of your 401k is consistent with the overall distribution of your Will.
401k assets pass by operation of law directly to your beneficiary and will supersede your will. Make sure you select a primary and contingent beneficiary. You can chose the same beneficiaries you chose in your will but if you leave it to your estate instead of an individual directly, there will not be an opportunity to stretch withdrawals over the life of the beneficiary.
PPG 128303 (8/17)(Exp 8/19)
Aside from a will, carefully completing a beneficiary designation form for each retirement plan asset is very important. Should death occur, assets may move quickly and easily to whom the plan owner intended with a completed and filed directive, including for rollover by living persons able to defer income taxation.
The executed beneficiary form is a very powerful document and not to be taken lightly. Since the form operates by law and overrides other estate documents, care should be taken when filling out such as primary and contingent beneficiaries, relative percentages, and any per stirpes / per capita elections. Retain a copy and review it regularly. Without a properly completed beneficiary form, the passing of individual retirement account or qualified assets could be subjected at a critical time to the interpretation of plan document provisions by the custodian, plan administrator, or a court review.