Did you know that one of the largest scholarship funds in the College’s history almost didn’t happen?

While it was the donor’s intention, as stated in his will, to fund the scholarship with his remaining assets, he didn’t change the beneficiary designation on his individual retirement account (IRA) — his largest remaining asset. It listed a relative as beneficiary instead of his estate or the College. The donor didn’t realize that beneficiary designations take precedence — before what is written in a will.

Even if he had directed a specific asset, like the IRA, to the College in his will, the beneficiary designation would come first. This is also true with other assets, such as insurance policies and savings bonds.

So how did the scholarship get funded? The named beneficiary declined the inheritance, thus allowing the will to direct the assets — an outstanding gesture of love on his part.

Using assets like an IRA or savings bonds as a charitable bequest may make sense, because many are tax-deferred. But please remember, the beneficiary designation takes precedence to your will and is generally easy to change — usually free of charge.

To ensure that your wishes are carried out, remember to update your beneficiary designations.