who notifies Vanguard beneficiaries?

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miket29
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who notifies Vanguard beneficiaries?

Post by miket29 »

How are you arranging to notify your beneficiaries about your IRA? I have left my Vanguard IRA to my siblings and some of it to a charity.

According to Vanguard
If you name organizations as beneficiaries, arrange for someone to notify them of your death. We don't contact beneficiaries after the deaths of Vanguard account owners.
https://investor.vanguard.com/beneficiaries/iras
I have told my siblings where to look for my assets when I pass. So they'll get in touch with Vanguard to demand their inheritance. But what if they die before me? Or we're all in the same car crash? At that point all the funds would go to the charity, but unless I figure out how to send them a message after my death they won't know they should collect the funds.

Or for that matter, do I need to depend on my siblings to tell the charity of my passing? If they survive me but don't notify the charity, does Vanguard just keep the money?
Last edited by miket29 on Tue May 11, 2021 11:26 pm, edited 1 time in total.
sailaway
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Re: who notifies Vanguard beneficiaries?

Post by sailaway »

If you work with the gifting division of a large organization, they will probably be scanning obituaries, just in case.
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celia
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Re: who notifies Vanguard beneficiaries?

Post by celia »

If your executor or trustee won't do this basic task, you should choose someone else.

First off, do your executor and trustee know where to find your will or trust and a list of your assets?

miket29 wrote: Tue May 11, 2021 11:23 pm Or for that matter, do I need to depend on my siblings to tell the charity of my passing? If they survive me but don't notify the charity, does Vanguard just keep the money?
If there is unclaimed money left after you die, it will eventually go to your state's unclaimed property division until someone claims it. Possibly, you have some assets there already.
delamer
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Re: who notifies Vanguard beneficiaries?

Post by delamer »

celia wrote: Wed May 12, 2021 2:10 am If your executor or trustee won't do this basic task, you should choose someone else.

First off, do your executor and trustee know where to find your will or trust and a list of your assets?

miket29 wrote: Tue May 11, 2021 11:23 pm Or for that matter, do I need to depend on my siblings to tell the charity of my passing? If they survive me but don't notify the charity, does Vanguard just keep the money?
If there is unclaimed money left after you die, it will eventually go to your state's unclaimed property division until someone claims it. Possibly, you have some assets there already.
You need a will and an executor. Problem solved.
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tibbitts
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Re: who notifies Vanguard beneficiaries?

Post by tibbitts »

miket29 wrote: Tue May 11, 2021 11:23 pm How are you arranging to notify your beneficiaries about your IRA? I have left my Vanguard IRA to my siblings and some of it to a charity.
I don't understand the question. Obviously nobody will be notifying anybody themselves. You need a designated person that you keep in contact with at least every week or so, but are essentially never near enough to that you share any physical risk in common. When they don't hear from you, they'll investigate. Then they'll execute whatever instructions you've left for them, and of course you have to periodically make sure the instructions are up-to-date and that your designated person can access them. Obviously ideally you'll have a backup designated person, although finding just one person is usually extremely difficult. Some people's lifestyles make them more or less appropriate for the task than others.
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Re: who notifies Vanguard beneficiaries?

Post by jebmke »

celia wrote: Wed May 12, 2021 2:10 am If your executor or trustee won't do this basic task, you should choose someone else.
Yes; my wife has been personal representative for two family estates and part of the role is to notify beneficiaries. My memory is fuzzy but I think the court instructions were to not advise specifics until an inventory had been done and submitted to the court clerk and any external claims identified. Might vary by state on what is done when. In any event, all the accounts were locked down until the court approved her as representative and even then, meticulous details on disbursements for holdover expenses and final expenses had to be supplied.
Don't trust me, look it up. https://www.irs.gov/forms-instructions-and-publications
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dodecahedron
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Re: who notifies Vanguard beneficiaries?

Post by dodecahedron »

jebmke wrote: Wed May 12, 2021 1:41 pm
celia wrote: Wed May 12, 2021 2:10 am If your executor or trustee won't do this basic task, you should choose someone else.
In any event, all the accounts were locked down until the court approved her as representative and even then, meticulous details on disbursements for holdover expenses and final expenses had to be supplied.
Accounts that have specific *named individuals* designated as beneficiaries (such as most IRAs, 401ks,life insurance, TOD/POD transfer on death or payable on death titled bank and brokerage accounts) are not locked down, since they are not actually part of the estate.

If an individual knows that they were named as the beneficiary of an account, e.g., they are in possession of a bank or brokerage statement that listed the beneficiaries and their name is among them, they can present that information along with evidence of death and get access to their designated share of the account even before the executor is appointed (which can take some time.)

When my husband was settling his late mother's estate, he noticed that a number of her accounts (bank accounts, brokerages, and an IRA) were titled in this way (with him and his only sibling designated as 50-50 beneficiaries) so he and his sibling were able to obtain access to those funds pretty much immediately on demand and presentation of the death certificate.

It took longer for him to get a letters of official appointment as executor by the probate court and get access to the remaining financial accounts as well as title to other assets such as his mother's house, its contents, and her cars. (He had been named co-executor in his mother's will but the other named co-executor in the will was an institution, which was not actually interested in carrying out its duties and everything was out-of-state and cumbersome. Eventually a representative of the institution signed an official legal statement declining to serve as co-executor and my husband was able to function independently as the official sole executor of the estate.)

But at least some of the assets were easily accessible even before the estate executorship was official, so he and his sister had funds to keep the necessary bills paid (taxes, insurance, utilities) on his mother's house even before the executorship issue was resolved.
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Re: who notifies Vanguard beneficiaries?

Post by jebmke »

dodecahedron wrote: Wed May 12, 2021 2:23 pm Accounts that have specific *named individuals* designated as beneficiaries (such as most IRAs, 401ks,life insurance, TOD/POD transfer on death or payable on death titled bank and brokerage accounts) are not locked down, since they are not actually part of the estate.
I don't recall the exact titling of the accounts. But in some cases the banks don't know the rules. My wife had signatory authority on her father's checking account and it was frozen anyway. They put a hold on credit cards, everything. It only took a couple of days to file the paperwork with the court though. That release the checking account. The savings/CD account remained locked for a while - I remember we paid for a number of expenses (later reimbursed).
Don't trust me, look it up. https://www.irs.gov/forms-instructions-and-publications
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dodecahedron
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Re: who notifies Vanguard beneficiaries?

Post by dodecahedron »

jebmke wrote: Wed May 12, 2021 2:26 pm
dodecahedron wrote: Wed May 12, 2021 2:23 pm Accounts that have specific *named individuals* designated as beneficiaries (such as most IRAs, 401ks,life insurance, TOD/POD transfer on death or payable on death titled bank and brokerage accounts) are not locked down, since they are not actually part of the estate.
I don't recall the exact titling of the accounts. But in some cases the banks don't know the rules. My wife had signatory authority on her father's checking account and it was frozen anyway.
Signatory authority on an account is entirely different from POD or TOD beneficiary designation.

I had signatory authority on one of my late husband's bank accounts (for his sole proprietorship business) but that authority automatically expired on his death, so the bank for that account was completely correct in freezing that particular account after they learned of his death.

Signatory authority on an account is akin to a POA. It does not convey an ownership interest, it simply authorizes the designated person to carry out transactions on the account while the owner is alive. (In our case, he was the owner and CEO of the business and I was the CFO, and authorized to use the business account to do things like pay the business's bills, do the business's payroll, etc.) But the funds in the account belonged to him as sole proprietor and were part of his estate, so they were properly frozen in accordance with the titling of the account. I could not get access to that particular account until after I had a letter of appointment as executor of the estate.

But if the account had been titled as POD dodecahedron or TOD dodecahedron, it would have been entirely different and our family's experiences with those types of account titling as TOD or POD is that the banks know exactly how to handle them once they learn of the original owner's death.
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Re: who notifies Vanguard beneficiaries?

Post by bsteiner »

That’s the problem with life insurance and retirement benefits. There’s no executor to collect them.

But you need to name beneficiaries for life insurance and retirement benefits for asset protection and in the case of IRAs in many cases to get a longer distributions period l.
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Eric
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Re: who notifies Vanguard beneficiaries?

Post by Eric »

bsteiner wrote: Wed May 12, 2021 8:06 pmyou need to name beneficiaries for life insurance . . . for asset protection
In Texas, the insurance exemption applies even if the insured's estate is a beneficiary. Tex. Ins. Code § 1108.052.
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joe8d
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Re: who notifies Vanguard beneficiaries?

Post by joe8d »

Paper records that are assessable to the executor are what you need.
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Chuckles960
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Re: who notifies Vanguard beneficiaries?

Post by Chuckles960 »

This is an issue I never thought about. So if an account that avoids probate has named beneficiaries, if the beneficiaries don't know about it, Vanguard keeps the money?
delamer
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Re: who notifies Vanguard beneficiaries?

Post by delamer »

Chuckles960 wrote: Thu May 13, 2021 12:38 pm This is an issue I never thought about. So if an account that avoids probate has named beneficiaries, if the beneficiaries don't know about it, Vanguard keeps the money?
I imagine it goes to the state (eventually) if it’s unclaimed.

But this is why your heirs and/or executor need to know what assets you own and where they are held, even if you don’t want to provide details on amounts.
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Re: who notifies Vanguard beneficiaries?

Post by NAVigator »

Couldn't this be resolved by creating a document that lists everything that needs attention when the owner passes on. This is sometimes referred to as a "Death Book". I live alone and I created one. I made sure my beneficiaries know where it is and where my will, POA, etc are. The executor can use this as a guide for what exists, what people and accounts to notify, etc.

Here is an example that was also put in the Wiki;
viewtopic.php?t=119346
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Re: who notifies Vanguard beneficiaries?

Post by CAsage »

I would like to add that I know from personal experience that no one automatically notifies the beneficiaries, nor will companies let one beneficiary know about assets left directly to another. A beneficiary can only inquire on their own behalf. If the decedent has not thoughtfully prepared a list of all assets and beneficiaries, and the bumbling executor fails to catch the next year's statements or misses something, it just sits. Companies holding assets do not scan the SS database for death dates, or read obituaries. After some years of being unable to contact or hear from someone (inactive account), the funds are generally escheated (is that the right word) to the State. I now file a short list of assets with my tax folder, because for sure someone will look there. Death books are also very useful - but there are a lot of "oh, not yet!" deniers out there.
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Re: who notifies Vanguard beneficiaries?

Post by Broken Man 1999 »

NAVigator wrote: Thu May 13, 2021 3:06 pm Couldn't this be resolved by creating a document that lists everything that needs attention when the owner passes on. This is sometimes referred to as a "Death Book". I live alone and I created one. I made sure my beneficiaries know where it is and where my will, POA, etc are. The executor can use this as a guide for what exists, what people and accounts to notify, etc.

Here is an example that was also put in the Wiki;
viewtopic.php?t=119346
This!

I am updating mine at this time.

All financial accounts, social media, emails, password manager, insurances, bill-paying methods/timing/sources, the list goes on....

As I update things, I really appreciate having a simple portfolio, with fewer investments, and fewer institutions to deal with.

If I have identified things correctly, it should be a breeze for those left behind.

After my update, I will share with DDs so they will have updated knowledge of our finances.

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Re: who notifies Vanguard beneficiaries?

Post by LilyFleur »

CAsage wrote: Thu May 13, 2021 3:15 pm I would like to add that I know from personal experience that no one automatically notifies the beneficiaries, nor will companies let one beneficiary know about assets left directly to another. A beneficiary can only inquire on their own behalf. If the decedent has not thoughtfully prepared a list of all assets and beneficiaries, and the bumbling executor fails to catch the next year's statements or misses something, it just sits. Companies holding assets do not scan the SS database for death dates, or read obituaries. After some years of being unable to contact or hear from someone (inactive account), the funds are generally escheated (is that the right word) to the State. I now file a short list of assets with my tax folder, because for sure someone will look there. Death books are also very useful - but there are a lot of "oh, not yet!" deniers out there.
I need to do the death book (maybe renaming it something more positive).

Whether or not you have a death book, please print out hard copies of your beneficiary designations and let your executor know where those are. There was a post on this forum of Vanguard losing beneficiary designations, and fortunately the remaining spouse had paper copies of that.
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Re: who notifies Vanguard beneficiaries?

Post by tibbitts »

LilyFleur wrote: Thu May 13, 2021 4:45 pm
CAsage wrote: Thu May 13, 2021 3:15 pm I would like to add that I know from personal experience that no one automatically notifies the beneficiaries, nor will companies let one beneficiary know about assets left directly to another. A beneficiary can only inquire on their own behalf. If the decedent has not thoughtfully prepared a list of all assets and beneficiaries, and the bumbling executor fails to catch the next year's statements or misses something, it just sits. Companies holding assets do not scan the SS database for death dates, or read obituaries. After some years of being unable to contact or hear from someone (inactive account), the funds are generally escheated (is that the right word) to the State. I now file a short list of assets with my tax folder, because for sure someone will look there. Death books are also very useful - but there are a lot of "oh, not yet!" deniers out there.
I need to do the death book (maybe renaming it something more positive).

Whether or not you have a death book, please print out hard copies of your beneficiary designations and let your executor know where those are. There was a post on this forum of Vanguard losing beneficiary designations, and fortunately the remaining spouse had paper copies of that.
I don't recall that post, but it would be extraordinary if Vanguard lost this information after it had shown up online. So I'm assuming this was a case of not verifying that the update had actually occurred?
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Re: who notifies Vanguard beneficiaries?

Post by LilyFleur »

tibbitts wrote: Thu May 13, 2021 9:16 pm
LilyFleur wrote: Thu May 13, 2021 4:45 pm
CAsage wrote: Thu May 13, 2021 3:15 pm I would like to add that I know from personal experience that no one automatically notifies the beneficiaries, nor will companies let one beneficiary know about assets left directly to another. A beneficiary can only inquire on their own behalf. If the decedent has not thoughtfully prepared a list of all assets and beneficiaries, and the bumbling executor fails to catch the next year's statements or misses something, it just sits. Companies holding assets do not scan the SS database for death dates, or read obituaries. After some years of being unable to contact or hear from someone (inactive account), the funds are generally escheated (is that the right word) to the State. I now file a short list of assets with my tax folder, because for sure someone will look there. Death books are also very useful - but there are a lot of "oh, not yet!" deniers out there.
I need to do the death book (maybe renaming it something more positive).

Whether or not you have a death book, please print out hard copies of your beneficiary designations and let your executor know where those are. There was a post on this forum of Vanguard losing beneficiary designations, and fortunately the remaining spouse had paper copies of that.
I don't recall that post, but it would be extraordinary if Vanguard lost this information after it had shown up online. So I'm assuming this was a case of not verifying that the update had actually occurred?
Of course, now that I mention it, I cannot find the post. :oops:
I do not recall that detail, but because of it, I have printed out my beneficiary details from my 401k and brokerage accounts, just in case.
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