Direct answer: After marriage, update beneficiary designations on every financial account. Beneficiary designations override your will, so an account that still names a former partner or a parent passes to that person, not to your spouse. This is the most common and most costly oversight in estate planning after a major life event. Start with life insurance, employer retirement plans, and IRAs, then move to brokerage accounts and bank accounts.
Marriage: The Investment Accounts and Beneficiaries to Review
Why does a beneficiary designation override a will?
A will is a legal document that directs how your estate is distributed. However, many financial accounts pass outside the estate through a contractual beneficiary designation filed directly with the account custodian. These designations are separate from and take precedence over any conflicting instructions in a will.
When you open an IRA, brokerage account, life insurance policy, or employer retirement plan, you name one or more beneficiaries as part of the account agreement. At death, the custodian or insurer distributes the asset according to that on-file designation without probate, without reference to the will, and often within days. A court cannot override a valid beneficiary designation by pointing to will language.
Real-world consequences: A person who marries, updates their will to leave everything to the spouse, but forgets to update an old IRA that names a sibling will have that IRA pass to the sibling regardless of the will. This outcome is not an error in the legal system; it is how beneficiary designations are designed to work. Courts have consistently upheld old designations over wills in these situations.
Trusts can be named as beneficiaries and may provide more flexible distribution rules for more complex situations, but doing so introduces additional complexity and should be reviewed with an attorney.
Which accounts and policies require beneficiary updates after marriage?
Review and update beneficiaries on every account that has one. The following categories apply to most people:
- Employer retirement plans (401k, 403b, 457, pension). For plans governed by ERISA, federal law requires that a spouse be the primary beneficiary unless the spouse signs a written waiver witnessed by a plan representative or notary. Even so, confirm the on-file designation is current, especially if the plan was set up before marriage.
- IRAs (traditional and Roth). No ERISA requirement applies. An IRA passes to whoever is named on file, with no automatic designation for a spouse. This is the most frequently overlooked account type.
- Life insurance policies. Check both employer-provided group life insurance and individually owned policies. Group policies may have a default designation or a form on file that names a prior relationship.
- Brokerage and taxable investment accounts. These can be set up with a Transfer on Death (TOD) or Payable on Death (POD) designation, which allows the account to pass outside probate. Review the designation on file.
- Bank checking and savings accounts. Payable on Death designations work similarly to TOD. These are separate from joint account ownership, which is a different mechanism.
- Health Savings Accounts (HSAs). If you or your spouse has an HSA, update the beneficiary. If the spouse is named, the account passes to the spouse's HSA tax-free. Any other beneficiary causes the account to be taxed as income in the year of death.
- Annuities and deferred compensation plans. Review any annuity contracts and any non-qualified deferred compensation plan with a designated beneficiary form.
What is a spousal IRA and when is it relevant?
A spousal IRA is not a separate account type. It is a Roth or traditional IRA contribution made on behalf of a spouse who has little or no earned income. Normally, IRA contribution eligibility requires the account holder to have earned income (wages, self-employment income, or certain other compensation) equal to or greater than the contribution amount. The spousal IRA rule allows a working spouse's earned income to support contributions for both spouses.
For 2026, each spouse may contribute up to $7,000 (or $8,000 if age 50 or older) to their own IRA, provided the couple's combined earned income is at least equal to the total contributions. The accounts remain separate and individually owned, even if funded from joint income.
When the spousal IRA rule matters most:
- One spouse reduces work hours, takes parental leave, or leaves the workforce entirely after marriage.
- One spouse is a full-time student, caregiver, or stays home with children.
- One spouse earns significantly less than the IRA contribution limit in a given year.
The spousal IRA contribution must be made to an IRA in the non-earning spouse's own name, not to a joint account. Standard Roth IRA income limits (phase-outs based on modified adjusted gross income) still apply to a spousal Roth IRA contribution, so high-income couples should verify eligibility before contributing.
Frequently Asked Questions
Does my spouse automatically become my 401(k) beneficiary after marriage?
For 401(k) and most employer retirement plans governed by ERISA, federal law requires your spouse to be the primary beneficiary unless the spouse signs a written waiver witnessed by a plan representative or notary. For IRAs, there is no such automatic rule: the named beneficiary controls, and a spouse is not automatically added. If an IRA names a former partner or a parent, that designation stands regardless of marriage.
What is the difference between a primary and a contingent beneficiary?
A primary beneficiary inherits the account if they survive the account holder. A contingent (secondary) beneficiary inherits if the primary beneficiary does not survive. Without a named contingent beneficiary, the account may pass through probate if the primary beneficiary predeceases the account holder. Naming both is best practice.
How do community property states affect investment accounts after marriage?
In the nine community property states (Arizona, California, Idaho, Louisiana, Nevada, New Mexico, Texas, Washington, Wisconsin), assets acquired during the marriage are generally considered equally owned by both spouses by default. This affects how brokerage accounts, income, and assets titled in one spouse's name may be treated at death or divorce. Pre-marital assets and inheritances remain separate property in most cases. Couples moving between states should review how their state of current residence treats assets from prior states.