What types of accounts do you have?
Your options for whether and by what method to add beneficiaries to your accounts depend on the accounts that you hold.
IRAs
The beneficiary designations that you make on a retirement account like an IRA generally supersede any other instructions you leave, including your will. So if your will states that your spouse is your IRA beneficiary, but the IRA itself designates your children as your beneficiaries, your children will inherit your IRA.
If you don't designate beneficiaries for your IRA, your assets will pass to your spouse (if you're married at the time of your death) or your estate (if you're not married at the time of your death).
Learn more about adding beneficiaries to your IRAs
Beneficiaries & backup beneficiaries
A beneficiary receives your assets after your death. Your beneficiary must survive you (or be a charity or an existing trust). A backup or contingent beneficiary will inherit your assets only if you have no surviving beneficiaries.
Nonretirement accounts
The decision whether to name beneficiaries on your nonretirement accounts should be made in the context of your estate plan. Depending on the choices you've already made, your nonretirement accounts may not need beneficiaries. Consult an estate-planning attorney to determine what's best for you.
Learn more about adding beneficiaries to your nonretirement accounts
Joint accounts
Your Vanguard joint accounts don't need beneficiaries. Joint accounts simply pass to the surviving owner.
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IRA (individual retirement account)
A type of account created by the IRS that offers tax benefits when you use it to save for retirement.
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Will
A legal document in which a person leaves instructions for how to distribute his or her property after death.
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Estate
All of a decedent's liabilities and assets, including property (real and personal).
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Trust
A legal arrangement through which property, such as investments or real estate, is held by a trustee on behalf of a beneficiary. Trusts are often used as part of a plan to minimize or eliminate estate taxes.
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Estate plan
A plan to carry out an individual's wishes as to the administration and disposition of his or her property before or after his or her death.
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Joint account
An account with two or more owners.
GOOD TO KNOW The beneficiaries you select for your IRA won't carry over to your nonretirement account, or vice versa. But if you have multiple Vanguard IRAs of the same type—for example, 2 traditional IRAs—the beneficiaries you designate on one of them will carry over to all of them.
