Yes, there is! Although beneficiary, heir and descendant may seem the same from the outside, legally each term has a very different meaning.
Below are the differences between each term and an example:
- A beneficiary is a person who benefits from the transfer of property through a Will or Trust, or the transfer of monetary assets such as an IRA or other account through a specific beneficiary or Transfer on Death designation. You may have your spouse listed as your beneficiary on a 401K or IRA account.
- An heir is a person who inherits property or monetary assets when there is no Will or Trust. Each state has specific rules regarding how property or other assets will pass if you die without a Will and it’s been said that in this circumstance, the STATE writes your Will for you, but not how you may have wished. In Illinois, it is determined by the Statute of Descent and Distribution. This statute starts by asking if there is a surviving spouse and/or descendant of the decedent. Distribution is determined based on those 2 criteria to start; if no surviving spouse or descendant, the court then looks to parents, siblings, or grandparents.
- A descendant, on the other hand, is simply a person’s child, grandchild, great-grandchild, or other offspring in direct line of descent. A descendant may or may not be a beneficiary or an heir.
Do you want to be sure your assets are going to the people who you want to have receive them, not just the ‘next in line?’ If you want to review what is best for you and your family if something happened to you, our Attorneys at The Greenberg Law Firm are ready, willing, and able to help you secure your savings and property for your loved ones.