What Should I Consider When Choosing a Contingent Beneficiary?

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  • Written By: Kristie Lorette
  • Edited By: O. Wallace
  • Last Modified Date: 02 December 2019
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A contingent beneficiary is a secondary or backup beneficiary. It is the beneficiary of an asset when the primary beneficiary, or first beneficiary, of the asset has passed away. Some of the items you should consider when choosing a contingent beneficiary include family relations, good friends, organizations that can benefit from the money or asset and how the beneficiary may benefit from you leaving them the money, asset or other possession.

Before you choose a contingent beneficiary, first choose a primary beneficiary. The person, trust, organization or some combination of these three that you want to receive the item is the primary beneficiary. The contingent beneficiary is the person, organization, trust or some combination of if the primary beneficiary has also passed away. Typically, your primary beneficiaries are your immediate family members, but when choosing a contingent beneficiary, you may also want to consider some people from your extended family.

Another option when choosing a contingent beneficiary is close friends. Generally, close friends make ideal contingent beneficiaries when you do not have family members to make as contingent beneficiaries or you simply do not want to make a family member the contingent beneficiary. In some ways, close friends are just like family members, and in some cases better than family members, so it makes sense to make a close friend a contingent beneficiary.


Another consideration to take into account when assigning a contingent beneficiary is organizations that can benefit from the money or assets that your are leaving behind. For example, if your mother died of breast cancer, you may wish to make one of the breast cancer organizations a contingent beneficiary. Leaving this money to the organization allows you to contribute to research and other needs required to possibly find a cure for a disease that is near and dear to your heart.

When it comes to physical assets, you may also want to consider making organizations a contingent beneficiary. For example, if you are a map collector and the local museum has a historical map collection, you may wish to make the museum a contingent beneficiary for the maps. In short, when choosing a contingent beneficiary for any of your money or assets, consider how the beneficiary will benefit from receiving what you are leaving to them. The money you leave your niece may be what she needs to pay for her college education. The money that you leave to the cancer organization may help in finding better medicine or even a cure for patients suffering from the disease.


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