Starting a life insurance policy is one of the most important things you can do for your family. In addition to covering your funeral and burial costs, your policy may provide a little extra to help your loved ones through a difficult time. However, choosing the policy’s beneficiary may require some careful thought.

Are You Married?

If so, you may not have much choice in determining who your beneficiary will be. Washington, New Mexico, Louisiana, California, Wisconsin, Texas, Nevada, Idaho, and Arizona all mandate that the spouse of an individual must be named as a beneficiary. You may be able to name a second beneficiary, however.

No Spouse or Children Gives You More Choices

If you aren’t married and don’t have any children, you have much more leeway in selecting a beneficiary. You can also save money on your premiums by getting just enough coverage to pay for your burial expenses. If this is the case for you, consider choosing a sibling, cousin, or close friend as your beneficiary.

What If You Do Have Children?

If you have children under the age of 18, naming them as beneficiaries may be problematic. Under the law, they can’t directly receive that money until they turn 18 years of age. An ideal alternative is to establish a life insurance trust, which allows the children to receive payments from the policy via a guardian. This will involve selecting a guardian you trust to administer the payments.

Update Your Policy Regularly

It’s a good idea to start your life insurance policy as early as possible because you never know what life has planned for you. However, this means reviewing your policy on a regular basis and making necessary changes. For instance, if you get divorced, you may want to remove your spouse as a beneficiary of the policy. Alternatively, getting married may require you to add your spouse as a beneficiary.

Aside from legal requirements, choosing your beneficiary is up to you, and you will want to pick someone you trust. Your insurance agent can help you meet the legal requirements for selecting a beneficiary and address any other concerns you may have. This is an essential step in making sure your loved ones can move forward after you’re gone, so selecting a beneficiary should be done with much care and thought.