If I have a 401b retirement through a non-profit hospital employee, can creditors come after my beneficiaries on this kind of retirement plan?

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If I have a 401b retirement through a non-profit hospital employee, can creditors come after my beneficiaries on this kind of retirement plan?

In case of my death, is any money that might remain in plan subject to creditors?

Asked on March 5, 2012 under Estate Planning, Nebraska

Answers:

FreeAdvice Contributing Attorney / FreeAdvice Contributing Attorney

Answered 9 years ago | Contributor

Under the laws of all states in this country, if your 401k retirement plan does not have a beneficiary designation on it at the time of your passing, it then becomes an asset of your estate. When that happens, the creditors of your estate for any monies owed can then make a claim upon this account.

As stated, the way to prevent it from being an asset of your estate is to have a designated beneficiary on it prior to your passing.


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