Who receives benefits from an estate, retirement plan, annuity, trust, or life insurance policy?

• A. Beneficiary
• B. Heirs
• C. Ancestors
• D. Descendants

Answer: (A)

The main idea here is the term used for the person who is designated to receive the assets or proceeds from these instruments: the beneficiary. In estate plans, retirement accounts, annuities, trusts, and life insurance policies, the contract or will names a beneficiary who will receive the benefits, typically upon death or at a specified time. Heirs are people who would inherit under state law if there’s no will, and they aren’t necessarily the person named in the instrument. Ancestors and descendants describe lineage, not who is designated to receive assets. In a trust, distributions go to the trust’s beneficiaries; in a life insurance policy, the death benefit goes to the beneficiary. So the person who receives benefits in these contexts is the beneficiary.