Boston Standard Wealth Management

Plan to Succeed

  • Home
  • About
    • Private Wealth Management
    • Our Team
    • Sustainability
    • Fiduciary Standard
  • FAQ
  • Blog
  • Contact
  • Client Login

The Per Stirpes Beneficiary Election

June 9, 2019 by Lee Eudy

You can assign beneficiaries to practically any type of investment account. In fact, most account applications embed a section where beneficiaries can be named.  You may also see “Per Stirpes” checkboxes in this section. From the Latin meaning “by the branch” a Per Stirpes election divides an estate among the branches of a family. These designations are typically used to protect the inheritance of grandchildren.  The following examples illustrate how the Per Stirpes designation can change who inherits an investment account.

Example 1:  Sally is the single mother of two children, Tom and Jane. Sally names each of her children as a 50% beneficiary of her IRA account. In this example, let’s assume she DOES NOT make the Per Stirpes election for either of her beneficiaries. Tom and Jane each have children of their own (Sally’s grandchildren).  If Tom predeceases Sally, then Jane will inherit the entire IRA when Sally dies. Tom’s child will receive nothing. 

Example 2:  Same situation – Sally names Tom and Jane 50/50 beneficiaries of her IRA, but in this example, she DOES make the Per Stirpes election by checking the Per Stirpes box beside the name of each child. In this scenario, if Tom dies before Sally, his children will inherit the 50% of the IRA originally designated for Tom when Sally dies. Jane will receive the other half of the account. So, with Per Stirpes elected, the inheritance continued onto Tom’s branch of the family, even though Tom’s children were never specifically named.

As always, please consult with your estate planning attorney to ensure account title, beneficiary designations, etc. align properly with your overall estate plan.

Share this:

  • Click to share on Facebook (Opens in new window)
  • Click to share on Twitter (Opens in new window)
  • Click to share on LinkedIn (Opens in new window)

Uncategorized

WHAT WE'RE READING

The Psychology of Money

Read Review

Subscribe

Provide your email address to subscribe to our quarterly newsletter to receive tips, news, and updates.

Recent Posts

  • 2023 Plan Limits
  • Pleasant Surprise for MA Taxpayers
  • I Bonds: Inflation’s Silver Lining
  • Rebalancing your 401(k) can be Confusing
  • 2022 Plan Limits
  • The Psychology of Money
  • Massachusetts Paid Family and Medical Leave
  • Few Changes in the 2021 Plan Contribution Limits
  • IRS Announces Tax Deadline Updates
  • The AfterTax 401(k) & Roth Conversions
  • TD Ameritrade January Mail-A-Thon
  • 2020 Plan Contribution Limits
  • The Per Stirpes Beneficiary Election
  • Safeguard Against Catastrophe with Umbrella Insurance
  • Giving Your Child an Allowance Can Really Pay Off
  • 401(k) limits are rising in 2019
  • Freezing your Credit Reports is now free. So what are you waiting for?
  • It’s FAFSA season!
  • State of Our Practice & Your Referrals
  • No Checks for Charity!
  • The Investor’s Manifesto
  • Charitable Giving in a High Standard Deduction World
  • Paying K-12 Tuition with a 529 Plan
  • 401(k) & Gifting Limits Set to Rise
  • Nudge
  • Equifax Breach & Identity Theft
  • Is The Tuition Bubble Starting to Leak?
  • Why YOU should pay your Group Disability Insurance Premium
  • Is your ESPP a fountain of guaranteed return?
  • Investing in Stocks vs. Markets

31 Church Street, Floor 3, Winchester, MA 01890 | Phone 781.721.2300 | Fax 781.721.0086

Site Disclosure | Client Relationship Summary | ADV | Privacy

Copyright © 2021

Disclosure

Boston Standard Wealth Management is registered with the Securities & Exchange Commission as an investment advisor. Our website is for informational purposes only and does not purport to render or offer to render personalized investment or financial planning advice. Advisory services may only be provided after the delivery of a disclosure statement and the execution of an investment advisory agreement by the client and the advisor. The website is intended to make available general information concerning our firm and the services we offer, but in no way should be construed as a complete description of either the firm or our service offering. Information throughout this site has been obtained from sources which we believe to be reliable, but we do not warrant or guarantee its timeliness or accuracy, and neither we nor our sources of information shall be held liable for errors or inaccuracies, regardless of cause, or any lack of timeliness or interruption in transmission to viewers. Nothing on this website should be interpreted as a real or assumed claim that past performance is any guarantee of future results.