Do Not Let Your EX Get Your Retirement Money
Jeffrey Rolison started working with Proctor & Gamble after graduating from college and enrolled in their retirement plan in April of 1987. At the time, Jeffrey was not married but did have a girlfriend and designated her as the ‘beneficiary’ on his retirement plan. In 1989, Jeffrey and his girlfriend broke up but Jeffrey never changed the beneficiary on his retirement plan with Proctor & Gamble.
Jeffrey Rolison worked for P&G for 28 years and passed away in 2015 at which time the value in his retirement account had grown to $754,000. At his death, his college girlfriend was still listed as the designated beneficiary.
Jeffrey had two surviving brothers who attempted to collect on the retirement benefits asserting that it was a mistake, and error that the ex-college girlfriend was not removed as the beneficiary.
As a result of litigation in Proctor & Gamble US Bus Serv. Estate of Rolison[1], The Court Ruled that the girlfriend was entitled to the retirement proceeds and not the two brothers. P&G had sufficient documentation that Jeffrey had listed his girlfriend as the beneficiary at the time he signed up for the retirement plan. Furthermore, while he was employed at P&G for 28 years, P&G sent numerous notifications to Jeffrey (and all the plan participants) that they should review their current beneficiary designations.
THE TAKE AWAY
Make sure on a routine basis you conducted a review of not only your retirement accounts (401ks, IRAs, 403(b), 403(d), etc.) but also any insurance or annuity investments that you may have to ensure that you have the correct beneficiaries and contingent beneficiaries listed. Also, when you do make any changes to the beneficiaries, get written documentation!
Track Down and consolidate any of your ‘orphan’ 401(k) plans. The number of forgotten 401(k) plans represent 25% of all 401(k) plans[2]