Education on spousal beneficiary rules on divorced and deceased participants can come through seminars, enrollment meetings and articles in newspapers or pension/IRA periodicals. But they can be found in PPA plan documents as well.
In “A Key Beneficiary Provision in PPA Plan Documents,” an article that appeared in the Fall 2015 issue of Plan Consultant, Paul Carmichael, QKA, ERPA, is the director of marketing at UB Pensions, writes that plan documents have become much more complicated and sophisticated, a change he believes is “all for the better.”
Carmichael notes that when he was reviewing a PPA plan document for a takeover client, he noticed language concerning exactly those rules.
“Wow. After reviewing this provision I was wondering what genius had the insight to implement and submit these ideas in their plan document. I then realized it was a prototype basic plan document and not a custom one,” writes Carmichael.
Carmichael says his impression on this topic “was always completely different, mainly due to my education having come from enrollment meetings with ‘enlightened’ stories to add excitement, interest and advice on the basic provisions of historical prototype plan documents.”
Carmichael notes that a provision about reverting back to pre-deceased status upon divorce and then using the family order as outlined in the plan document was missing in nearly all pre-PPA plan documents. He writes that after he reviewed several PPA plan documents, the new mainstream language seems to better protect the intentions of the participant and his or her family.
“You may be pleasantly surprised or change your thinking, or even change the way you give advice on different technical issues,” Carmicheal writes, as a result of these changes. He adds that he considers this an important way for good attorneys, administrators and pension professionals to demonstrate their value.
An updated beneficiary form is the best way to ensure that retirement assets are properly passed from one generation to the next according to the wishes of the participant. In a complicated industry with complicated rules, it’s good to know we are moving toward protecting the retirement security, and the wishes, of plan participants and their loved one,” Carmichael concludes.
In “A Key Beneficiary Provision in PPA Plan Documents,” an article that appeared in the Fall 2015 issue of Plan Consultant, Paul Carmichael, QKA, ERPA, is the director of marketing at UB Pensions, writes that plan documents have become much more complicated and sophisticated, a change he believes is “all for the better.”
Carmichael notes that when he was reviewing a PPA plan document for a takeover client, he noticed language concerning exactly those rules.
“Wow. After reviewing this provision I was wondering what genius had the insight to implement and submit these ideas in their plan document. I then realized it was a prototype basic plan document and not a custom one,” writes Carmichael.
Carmichael says his impression on this topic “was always completely different, mainly due to my education having come from enrollment meetings with ‘enlightened’ stories to add excitement, interest and advice on the basic provisions of historical prototype plan documents.”
Carmichael notes that a provision about reverting back to pre-deceased status upon divorce and then using the family order as outlined in the plan document was missing in nearly all pre-PPA plan documents. He writes that after he reviewed several PPA plan documents, the new mainstream language seems to better protect the intentions of the participant and his or her family.
“You may be pleasantly surprised or change your thinking, or even change the way you give advice on different technical issues,” Carmicheal writes, as a result of these changes. He adds that he considers this an important way for good attorneys, administrators and pension professionals to demonstrate their value.
An updated beneficiary form is the best way to ensure that retirement assets are properly passed from one generation to the next according to the wishes of the participant. In a complicated industry with complicated rules, it’s good to know we are moving toward protecting the retirement security, and the wishes, of plan participants and their loved one,” Carmichael concludes.
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