Is your spouse automatically your beneficiary? Only for some things. Federal law makes your spouse the automatic beneficiary of an employer-sponsored retirement plan like a 401(k), and property you own jointly with right of survivorship passes to them by operation of law. Everything else — life insurance, IRAs, payable-on-death bank accounts, brokerage accounts — pays whoever is named on the beneficiary form, married or not. And if you die without a will, state law decides what share your spouse receives, which is rarely the whole estate when children or parents are also living.
The short version, asset by asset:
- 401(k) and other ERISA-covered employer plans: spouse is automatic unless they signed a valid waiver.
- IRA: whoever is on the beneficiary form, spouse or not.
- Life insurance, annuities, POD/TOD accounts: whoever is on the beneficiary form.
- Property held jointly with right of survivorship or as tenants by the entirety: passes automatically to the surviving co-owner.
- Everything else (solely owned assets, no beneficiary form): governed by your will, or by state intestacy law if there is no will.
Beneficiary Forms Beat Your Will
Life insurance policies, annuities, retirement accounts, and bank or brokerage accounts labeled “Payable on Death” or “Transfer on Death” skip probate entirely. They pay the person named on the form. A will cannot override that designation, no matter what the will says.
This is where most people get burned. If you named a sibling on a life insurance policy ten years ago and never updated the form after marrying, your spouse gets nothing from that policy. The form is treated as your final instruction. Keeping these designations current after every marriage, divorce, birth, or death in the family matters more than the will itself for the assets they control.
401(k) vs. IRA: The Distinction That Catches People
Employer-sponsored retirement plans are the one major asset class where federal law makes a spouse the automatic beneficiary. Under the Employee Retirement Income Security Act, if you are married and participating in an employer plan, your spouse is entitled to your account balance when you die.1U.S. Department of Labor. FAQs About Retirement Plans and ERISA Wanting to name someone else is not enough. Your spouse must sign a written waiver, witnessed by a plan representative or a notary public.2Office of the Law Revision Counsel. 29 US Code 1055 – Requirement of Joint and Survivor Annuity and Preretirement Survivor Annuity Without that consent, any other beneficiary on the form is ignored.
IRAs work differently. Individual Retirement Accounts are not employer-sponsored plans and sit outside ERISA’s spousal protection.1U.S. Department of Labor. FAQs About Retirement Plans and ERISA The owner can name anyone without asking a spouse’s permission. That creates a trap: a spouse who was the protected beneficiary of a 401(k) can lose that protection entirely once the account holder rolls the money into an IRA and names someone else on the new form. A handful of states require spousal consent for IRA beneficiary changes; most do not.
Jointly Owned Property Passes Automatically
Real estate, bank accounts, and investment accounts held in joint tenancy with right of survivorship pass to the surviving co-owner by operation of law. The transfer happens outside probate, and a will cannot redirect it. Married couples use this frequently, but joint tenancy is available to any co-owners.
Tenancy by the entirety is a form of joint ownership available only to married couples, recognized in about half the states. It works like joint tenancy for inheritance purposes, so a surviving spouse automatically takes the property, and it adds protection against creditors of only one spouse. If you own your home this way, your spouse inherits it regardless of what your will says or whether you have one.
If There Is No Will
When someone dies without a valid will, state intestacy law decides who inherits. Every state puts the surviving spouse near the top, but how much the spouse actually gets depends on who else survives and which state’s rules apply.
Nine states follow community property. Most income and assets acquired during the marriage already belong equally to both spouses, so the surviving spouse keeps their half outright. The deceased spouse’s half, plus any separate property such as gifts or inheritances received individually, passes under intestacy. In practice the surviving spouse ends up with a large share because half the marital property was already theirs.
The remaining states use common law, where ownership follows whose name is on the title. Intestacy in these states gives the surviving spouse a share that depends on which other relatives are alive. With no children or parents surviving, the spouse typically takes everything. With children, most states split the estate between spouse and children, giving the spouse a priority share before the remainder is divided. The exact formulas differ, but a surviving spouse in a common law state rarely walks away with nothing under intestacy.
If the Will Leaves the Spouse Out
A will does not give someone unlimited power to disinherit a spouse. Most common law states have an elective share rule that lets a surviving spouse reject the will and claim a guaranteed percentage of the estate instead. The share generally runs between one-third and one-half of the estate’s value, and some states tie the percentage to the length of the marriage.
The elective share is not automatic. The surviving spouse must file a formal petition with the probate court, usually within six months after receiving notice that the estate has been opened, with an outside limit of around two years from the date of death. Miss the window and the right is gone.
Many states also calculate the elective share against an “augmented estate” that pulls in certain lifetime transfers, jointly held property, and retirement accounts, so the deceased cannot shrink the probate estate on paper and leave the spouse with nothing to claim against. Community property states generally do not use the elective share, because the surviving spouse already owns half the marital property.
Prenups Do Not Waive 401(k) Rights
Couples can change the default inheritance rules through a prenuptial or postnuptial agreement. These contracts can waive the elective share, eliminate intestacy rights, or carve out specific assets like a family business or property meant for children from a prior relationship. To hold up, the agreement typically has to be in writing, signed voluntarily, and backed by full financial disclosure from each side.
One exception trips up even careful planners. A prenuptial agreement cannot waive a spouse’s right to an ERISA-covered retirement account. Federal law requires that the person signing the waiver already be a spouse at the time of signing, and a fiancé is not a spouse.2Office of the Law Revision Counsel. 29 US Code 1055 – Requirement of Joint and Survivor Annuity and Preretirement Survivor Annuity If a couple signs a prenup waiving all retirement benefits and then marries, the waiver is unenforceable for the 401(k). The new spouse has to sign a separate waiver after the wedding, in writing, witnessed by a notary or plan representative, with the consent acknowledging the effect of the election. Plenty of couples skip this step and assume the prenup covered it.
What Divorce Does, and Doesn’t, Do
Divorce changes a spouse’s beneficiary status, but not always cleanly. Most states have adopted laws that automatically revoke beneficiary designations naming a former spouse once a divorce is finalized. These statutes typically cover wills, trusts, life insurance, and payable-on-death accounts. The ex is treated as if they had predeceased, and the asset moves to the contingent beneficiary or the estate.
ERISA plans are the complication. Federal law controls, and a state divorce decree does not automatically redirect the money. Dividing a 401(k) or pension in divorce requires a Qualified Domestic Relations Order instructing the plan administrator to pay a specified portion to the former spouse as an “alternate payee.”3U.S. Department of Labor. Qualified Domestic Relations Orders Under ERISA – A Practical Guide to Dividing Retirement Benefits Without a valid QDRO, the plan pays according to its own records, and a former spouse who was never removed as beneficiary can still collect.
Legal separation is not divorce. A legally separated spouse is still a spouse under most state laws and under ERISA, so the automatic protections remain in place until a final divorce decree is entered.
Deadlines That Can Erase the Right
Several spousal protections come with strict filing windows. The elective share deadline, discussed above, is the most common one lost. A surviving spouse who sits on it past the state’s cutoff is stuck with whatever the will provides, even if that is nothing.
Inherited retirement accounts also carry time pressure. A surviving spouse who wants to roll an inherited IRA into their own account should do so before the end of the year following the year of death to preserve certain distribution options. A surviving spouse gets options no other beneficiary gets: rolling the account into their own IRA and treating it as always theirs, which lets required minimum distributions follow their own age and life expectancy. Non-spouse beneficiaries generally have to empty the account within ten years under the SECURE Act, which can mean a much larger tax bill in a shorter window.4Internal Revenue Service. Retirement Topics – Beneficiary Missing the rollover window, or letting a default take effect, can trigger taxes a timely choice would have avoided.