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Neoliberal pension scams can crapify your inheritance

Whether "you" are a diamond geezer like me who'd like to pass something on, or somebody more youthful who has expectations. Here's the scenario:

Before Leonard Smith lost his battle with cancer in 2008, he worked with his financial advisors and attorneys to make sure his children received the balance of his retirement funds when he died.

A single mistake, however, thwarted his well-laid plans. Family members realized a year after he died that his IRA beneficiary form was filled out incorrectly. Instead of specifically listing the names of his children along with the percentages designated to each heir, Smith wrote: “To be distributed pursuant to my last will and testament,” where the disbursement of funds was spelled out.

But Smith’s failure to complete the form correctly invalidated the document, making his surviving spouse the beneficiary by default.

“I had no idea that a will could be trumped by an IRA beneficiary form,” Deborah Smith-Marez, 50, Leonard’s daughter, told Yahoo Finance.

Smith-Marez and her siblings fought in court to recover the money, but the court awarded the $400,000 in the IRA to their father’s wife, who married Smith two months before he died.

Like Smith-Marez, many Americans are unaware that long-forgotten beneficiary forms can override wills and undermine their loved ones' intentions.

Exactly the thing happened to me: An incorrectly filled out pension form. (Which, dear readers, is one of the many reasons I think seriously about expatriaition and currency abitrage.) But why blame the neo-liberals?

Because the neoliberals set up their daffy IRAs and 401ks and all the rest of their privatized retirement schemes --- daffy, that is, unless you're collecting a commission for "managing" them -- so they could gut and loot Social Security, that's why. So now we've got all these siloed retirement funds, which are accidents waiting to happen, as the Smiths found (and I found). And all because markets. Corey Robin describes the neo-liberal cultural moment:

In the neoliberal utopia, all of us are forced to spend an inordinate amount of time keeping track of each and every facet of our economic lives. That, in fact, is the openly declared goal: once we are made more cognizant of our money, where it comes from and where it goes, neoliberals believe we’ll be more responsible in spending and investing it. Of course, rich people have accountants, lawyers, personal assistants, and others to do this for them, so the argument doesn’t apply to them, but that’s another story for another day.

The dream is that we’d all have our gazillion individual accounts—one for retirement, one for sickness, one for unemployment, one for the kids, and so on, each connected to our employment, so that we understand that everything good in life depends upon our boss (and not the government)—and every day we’d check in to see how they’re doing, what needs attending to, what can be better invested elsewhere. It’s as if, in the neoliberal dream, we’re all retirees in Boca, with nothing better to do than to check in with our broker, except of course that we’re not. Indeed, if Republicans (and some Democrats) had their way, we’d never retire at all.

In real (or at least our preferred) life, we do have other, better things to do. We have books to read, children to raise, friends to meet, loved ones to care for, amusements to enjoy, drinks to drink, walks to take, webs to surf, couches to lie on, games to play, movies to see, protests to make, movements to build, marches to march, and more. Most days, we don’t have time to do any of that. We’re working way too many hours for too little pay, and in the remaining few hours (minutes) we have, after the kids are asleep, the dishes are washed, and the laundry is done, we have to haggle with insurance companies about doctor’s bills, deal with school officials needing forms signed, and more…

Exactly. The Smiths (and I) were leading our lives. We slipped up on one of the gazillion different forms on our "our gazillion individual accounts." The same thing could happen to you, whether you're looking at Social Security, like me, or are just out of college.

Aren't we as a society smart or caring enough to make sure the average shlub's inheritance goes where it's intended to go? Apparently not.

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