Primary vs. Contingent Beneficiaries: What You Need to Know

This consideration is an essential part of your estate planning.

By Scott Levine – Updated Apr 25, 2025 at 11:04 PM

Key Points

Identify a primary beneficiary to ensure your assets go to a dependent after death.
Name a contingent beneficiary to inherit assets if primary beneficiaries cannot.
Define asset distribution percentages if multiple primary beneficiaries exist.

When opening new accounts or estate planning, an essential consideration is who will be listed as the primary beneficiary and the contingent beneficiary to ensure that your assets are distributed appropriately to those you love and care about when you shuffle off this mortal coil. Primary beneficiaries, usually spouses and partners, are the first ones to inherit your assets when you die; contingent beneficiaries are the second ones in line to receive your assets.

Possibly, you already have some experience with the idea of beneficiaries if you have received assets through an inherited 401(k) or inherited IRA. It never hurts to brush up on this potentially confusing concept, so let's take a closer look at the primary and contingent beneficiaries, as well as some of the similarities and differences between them.

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	Primary beneficiaries	Contingent beneficiaries
Who can be named	Spouses, children, other family members, friends, philanthropic organizations.	Spouses, children, other family members, friends, philanthropic organizations.
Properties that can be inherited	Can receive a variety of assets including an inherited 401(k), an inherited IRA, life insurance.	Can receive a variety of assets including an inherited 401(k), an inherited IRA, life insurance.
Rights as inheritors	Are the first ones to receive assets upon their distribution from an estate.	Can only inherit assets if they can't be distributed to the primary beneficiaries.

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About the Author

Scott Levine is a contributing Motley Fool stock market analyst covering energy, industrials, technology, and materials. He is also a high school English teacher and a small business owner. He holds a bachelor’s degree in English and creative writing from Binghamton University, a master’s degree in secondary education from Adelphi University, and an advanced certificate in school building leadership from CUNY Queens College. A crossword puzzle enthusiast, he has solved more than 3,100 New York Times puzzles with a 97% solve rate.

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