A beneficiary is the person (or people) who gets the money from your life insurance policy when you’re not around to enjoy it. Think of it like leaving behind the ultimate gift card—except they can’t use it all on coffee. You have a few options:

This is your VIP; your Very Important Person (or People). They’re first in line for the payout. Most people pick their spouse, kids, or a favourite family member. But hey, if your dog Fido has been extra loyal, you could technically leave it to a pet trust. (More on trusts later!)

Think of this as your backup plan. If your primary beneficiary can’t accept the money (because they’ve passed on or chosen to opt out, unlikely but possible), your secondary beneficiary steps in. It’s like having a Plan B for your Plan A. Always smart.

If you’re leaving money to kids under 18, they can’t handle it themselves (because let’s face it, they’d probably spend it all on candy and video games). In this case, you’ll need a trustee—someone responsible who can manage the money on their behalf until they’re old enough to handle it wisely.

Here’s the beauty of it: you can name anyone!

• Family members: Spouse, kids, siblings, parents.

• Friends: Your BFF since grade school? Sure, why not!

• Charities: Want to do some good? Pick a cause you care about.

• A Trust: For minor children, pets, or anyone who needs a little help managing the funds.

At the end of the day, your beneficiaries should reflect your love, priorities, and life story. Just remember to review and update them over time—because leaving your life insurance to your college roommate “as a joke” 20 years ago might not seem as funny now.