Here are some of the steps that need to be taken to properly name IRA beneficiaries:
Spouse: A surviving spouse can either roll the funds into his or her existing IRA or establish an inherited IRA and take distributions that will be calculated based on his or her life expectancy.
Children: Just like spouses, children can stretch required distributions from an inherited IRA over their own life expectancies.
Trusts: A trust can be named a beneficiary of an inherited IRA, but there are a number of complex issues involved, so be sure to consult with a Personal Family Lawyer® for guidance.
Contingent beneficiaries: A surviving spouse may wish to disclaim interest in an inherited IRA, so the assets can pass to children or grandchildren. Therefore, it is important to name secondary as well as primary beneficiaries for your IRA so assets remain within the control of your family.
If you’d like to learn more about how to properly designate retirement accounts or other financial assets for loved ones or have other estate planning questions, call our office today to schedule a time for us to sit down and talk. We normally charge $750 for a Family Wealth Planning Session, but because this planning is so important, I’ve made space for the next two people who mention this article to have a complete planning session at no charge. Call today and mention this article.