When you draft a will, your main focus may be organizing the distribution of your assets. You can use the will to choose certain beneficiaries and specific assets that you want to go together. In some cases, joint ownership will also be used, such as when passing a family home on to multiple adult children.
One asset that you would likely consider is your life insurance policy. When you pass away, that insurance policy will then pay out. This gives you a chance to leave substantial financial assets to your family at a time when they may need them most.
But what if you want to change how the policy gets distributed? Can you do that in your will?
Changing the beneficiary designation
You actually should not change your will in this case. What you need to update is the beneficiary designation on the policy itself. That is all that the insurance company is going to use when deciding how to pay out the policy.
In fact, this designation trumps instructions that are left in your will. For instance, maybe your firstborn child was named as the beneficiary of the policy. You can write in your will that they need to split the money with their siblings or other family members, but the insurance company isn’t going to read the will. They will just pay the firstborn child, who then gets to decide if they want to share the payout or not.
There are steps you can take to have more control over these distributions, such as creating a trust. Just make sure you know what legal options you have.
