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Grammar 101: Beneficiary or Benefactor

March 22nd, 2013 by

Grammar 101 with Michael Kwan

The English language being what it is, you’re going to come across words that seem to have similar meanings and they’re used under similar contexts, but they cannot be used interchangeably. Tasty and tasteful do not mean the same thing. Another great example of this is beneficiary and benefactor. How are these words different and what do they mean?

Both of these terms are rooted in the word “benefit.” In the context of beneficiaries and benefactors, this “benefit” is usually of a monetary nature. It might have to do with a trust fund of some sort, for example, but the “benefit” could really be anything of value. However, the key difference between a benefactor and a beneficiary is the direction in which the benefit is being given.

A beneficiary is the person who receives the benefit. For example, let’s say that person A passes away and in his will, he gives his stamp collection to person B. In that example, person B is the beneficiary. Similarly, the person named as the beneficiary in a life insurance policy is the person who will receive the payment from the insurance company after the insured has passed away.

A benefactor, as you can probably imagine, is the person on the other end of that transaction. The benefactor is the person who gives money (or some other thing of value) to another person. If John names Mary as the beneficiary of his life insurance policy, then you can say that John is Mary’s benefactor. A benefactor can also support causes and institutions, donating their money or resources to various charitable and non-profit organizations.

Interesting fact: the word “benefactor” comes from the Latin terms for good (bene) and maker (factor). The benefactor is the person who is giving the benefits (and thus “making good”), while the beneficiary is the one who is receiving them.

It’s easy to confuse words that appear to have similar meanings, but just as you should know the difference between venomous and poisonous, it’s important to know the difference between beneficiary and benefactor… especially if you’re going over anything remotely related to finances. You wouldn’t want to name your children as your benefactors when you really mean to name them as your beneficiaries.

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