What "beneficiary" means in finance

A beneficiary refers to an individual, organization, or entity that is entitled to receive the benefits or assets of a financial account or investment after the account holder or investor passes away or in case of a specified event. For example, in life insurance, the beneficiary is the person who receives the insurance payout in case of the policyholder's death. In a trust, the beneficiary is the person who receives the trust's assets or income as per the trust's terms. The beneficiary can also be an institution, such as a charity, or a group of people, such as a family.