Your divorce decree does not update your beneficiary designations. For 401(k)s and most employer retirement plans, federal law means your ex-spouse remains the named beneficiary until you personally file a new form — regardless of what your divorce agreement says, and regardless of your state's laws.
Beneficiary designations are one of the most commonly overlooked steps after divorce — and one of the most consequential. Unlike a bank account or car title, these don't get changed as part of the divorce process. Each institution holds its own form, and that form controls who receives the money when you die, no matter what your will says.
This article explains why the divorce decree isn't enough (especially for retirement accounts), lists every account type you need to update, and tells you exactly how to update each one.
- Why "ERISA preemption" means your 401(k) beneficiary doesn't update on divorce
- The Supreme Court case that made this clear
- Every account type that needs a direct update
- How to update each type and what to watch for
- Why your will doesn't fix this
The Rule Most People Don't Know: ERISA Overrides Your State's Law
More than 26 states have "revocation-on-divorce" statutes — laws that automatically void a former spouse's beneficiary designation when a divorce is finalized. If you live in one of those states, you might assume the problem takes care of itself. For most accounts, it often does. But not for your 401(k) or employer pension.
ERISA — the Employee Retirement Income Security Act — is federal law that governs most employer-sponsored retirement plans, including 401(k)s, 403(b)s, and defined benefit pensions. ERISA explicitly preempts state laws on this point, meaning your state's revocation-on-divorce statute does not apply to these accounts.
The result: if you never updated your 401(k) beneficiary form after divorce, your ex-spouse remains the named beneficiary — and plan administrators are required by law to honor that form.
What about IRAs?
IRAs are not governed by ERISA — they're individual accounts, not employer plans. This means your state's revocation-on-divorce statute may apply to your IRA. But relying on state law instead of updating the form is a gamble that carries real risk: state laws vary, courts interpret them differently, and the institution holding your IRA may not know or apply your state's law correctly. The only safe approach is to update the form directly.
Why Your Will Doesn't Fix This
Beneficiary designations on retirement accounts, life insurance, and TOD/POD accounts pass outside of probate and outside of your will. They are completely separate legal instruments. Even a perfectly updated will that names a new beneficiary has no effect on a stale beneficiary form sitting in a different institution's system.
Courts have consistently held that the beneficiary form controls, regardless of the will. If your 401(k) form names your ex-spouse and your will names your children, your ex-spouse receives the 401(k). Full stop.
Every Account to Update — The Complete Checklist
Work through this list systematically. Each institution requires its own form, and some require notarization or spousal consent from a new spouse if you've remarried.
Retirement accounts — highest priority
Insurance accounts
Bank and investment accounts
Who to Name Instead
For most people updating beneficiaries after divorce, the natural choices are adult children, parents, or siblings. A few things to think through before you submit the forms.
Minor children generally can't directly receive retirement account or life insurance proceeds — a custodian or trust is typically required to manage assets for a minor. If your children are under 18, naming them directly may result in a court-appointed custodian managing the funds until they reach adulthood. Consulting an estate attorney about a simple trust or UTMA custodianship is worth the time if children are the intended beneficiaries.
Primary vs. contingent beneficiaries. Most accounts let you name both a primary beneficiary (first in line) and a contingent beneficiary (receives assets if the primary beneficiary predeceases you). Updating the primary beneficiary and leaving the contingent blank — or leaving an old contingent beneficiary in place — is a common oversight.
Percentages add up to 100%. If you name multiple beneficiaries, confirm the percentages total 100. A form with 50% named and the rest blank may cause complications at the time of distribution.
Quick Reference — How to Update Each Account
| Account type | Where to update | Typical process |
|---|---|---|
| 401(k) / 403(b) | Employer HR or plan portal | Online form or paper + possibly spousal consent |
| Pension | HR or plan administrator | Paper form; may require documentation |
| Traditional / Roth IRA | Brokerage or bank portal | Usually online; update primary + contingent |
| Individual life insurance | Insurance company or agent | Beneficiary change form; may need notarization |
| Employer group life | HR or benefits portal | Online or paper form |
| Annuity | Issuing insurance company | Form submitted to issuer directly |
| POD bank account | Bank in person or online | Update at the branch or in app |
| TOD brokerage account | Brokerage portal or call | Online update or form; each account separately |
| HSA | HSA custodian or HR portal | Beneficiary designation form |
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