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Guide to beneficiaries

Retirement accounts

IRAs let you determine what happens to your money upon your death. The money goes to the designated beneficiary and continues to grow tax-deferred in an inherited IRA. In most cases, your beneficiaries can stretch out required distributions and delay payment of taxes on those distributions.

Below are the most commonly asked questions about naming beneficiaries:

Why do I need beneficiaries?

Naming a primary beneficiary lets your assets go to whomever you choose. If you don't designate primary beneficiaries, your assets will pass to the default beneficiaries named under Vanguard's Custodial Account Agreement. The default beneficiary is your surviving spouse if you're married or your estate if you're not. If your assets pass to your estate, distribution of your assets may be delayed and may result in higher taxes for your beneficiaries.

Why should I name secondary (contingent) beneficiaries?

Secondary beneficiaries receive the assets if your primary beneficiaries die before you or refuse to take the inheritance. If no secondary beneficiaries are named, your assets may pass to your estate—subjecting them to the probate process, estate expenses and creditor claims.

Whom can I name as a beneficiary?

The table below shows the types of beneficiaries you can choose for your Vanguard retirement accounts. They can be assigned by name or for some, by relationship.

Beneficiary type Assign by name Assign by relationship
  • Name your spouse.
  • Changes may be required upon divorce or death.
  • To the person I am married to at the time of my death.
  • No changes are required if you remarry.
  • Name each person individually.
  • You can allocate unequal amounts.
  • Changes are required to add children.
  • No per stirpes provisions.
  • To my descendants who survive me per stirpes.
  • All children who survive you receive equal allocations.
  • Does not include stepchildren.
  • Additional children are included automatically.
  • Assets are allocated on a per stirpes basis.
  • Name each child individually.
  • You can allocate unequal amounts.
  • Changes are required to add grandchildren.
  • No per stirpes provisions.
  • To my grandchildren equally.
  • All grandchildren who survive you receive equal allocations.
  • Does not include stepgrandchildren.
  • Additional grandchildren are included automatically.
  • No per stirpes provisions.
  • Name one or more individuals.
  • Allocate assets as you wish.
  • Not available

The table below shows the types of entities you can choose for your Vanguard retirement account beneficiaries.

Other beneficiary types
  • The trust must already exist or be created under the terms of your will or estate-planning documents.
  • No documentation is needed to name the trust as the beneficiary, but is required for payout.
  • Consult with an estate-planning attorney.
Charities and organizations
  • Name one or more charities or organizations.
  • Consult with an estate-planning attorney.
  • Arrange to have someone who will notify the charity or organization after your death. Vanguard does not contact your beneficiaries.
  • Consult with an estate-planning attorney.

I've named my beneficiaries. What happens after I pass away?

It's a good idea to keep your beneficiary and account information with other legal papers. Upon your death, your beneficiaries or the person handling your estate should call Vanguard and speak with a specialist for instructions and help with paperwork and documentation. We will not contact your beneficiaries.


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