when selecting your beneficiaries 
upon first opening your financial accounts companies ask that you provide beneficiary information if you didn t provide it at that time you can request the paperwork that allows you to designate one or more beneficiary fill it out sign and date it and return it to the company this can usually be done online or in person maintain a copy for your files minor children can t directly receive the proceeds of a life insurance policy but you could name a trust or your children s legal guardian as a beneficiary 4examples of beneficiariesan individual retirement account ira gives the account holder the ability to designate a beneficiary or beneficiaries the options for distribution of the assets are different depending on whether the beneficiary is an eligible designated beneficiary or a designated beneficiary each beneficiary type may take a lump sum distribution of the proceeds if they so desire 5 if not the choices are as follows eligible designated beneficiaryan eligible designated beneficiary is a spouse the minor child of the account owner someone less than 10 years younger than the account owner e g a family member or friend or someone who is chronically ill or disabled designated beneficiarya designated beneficiary is someone who is listed in the account records as a beneficiary but who doesn t fit into the category of eligible designated beneficiary 5if the beneficiary is either an estate or a trust referred to as a non designated beneficiary the executor or trustee directs the distribution of assets they may open an inherited ira account and distribute assets according to the rules for a non designated beneficiary 7life insurance proceeds are tax free for the beneficiary and are not reported as gross income however any interest received or accrued is taxable 2life insurance beneficiaries can be individuals such as a spouse or an adult child or entities such as a trust for example if you have minor children you may choose to establish a trust and name it as the beneficiary of your life insurance policy if you were to pass away then the policy s death benefit would be paid to the trust the trustee would then manage those assets according to the terms of the trust on behalf of its beneficiaries e g your children life insurance beneficiaries can be revocable or irrevocable revocable beneficiaries can be changed if necessary at any time during the policy owner s lifetime this is similar to a revocable living trust which can also be changed as long as the trust grantor is still living an irrevocable beneficiary is permanent if there are multiple beneficiaries named to a life insurance policy e g a primary beneficiary and several contingent beneficiaries then they would all need to consent to any changes involving an irrevocable beneficiary therefore it s important to choose beneficiaries carefully 