If you are a named beneficiary of an IRA, you inherit a designated portion of the IRA assets when the IRA owner dies. A common mistake, especially by non-spousal beneficiaries, is to withdraw all IRA assets from the IRA account after the IRA owner’s death; there is a much better way to handle it. Generally, you can have a new inherited IRA account created, and have your share of the deceased owner’s IRA proceeds transferred directly into it. It is important that this is done correctly, and if done so, the benefits can be enormous.
Tuesday, December 13, 2011
Tuesday, December 6, 2011
You’re ready to start investing for retirement, but should you invest using your employer sponsored retirement plan (401(k), 403(b), etc.), an IRA, or something else? In general, these are the retirement investing priorities I would follow:
- 401(k) or 403(b) to get the maximum employer match
- Pay down high-interest debt
- IRA (traditional or Roth) up to annual limit
- 401(k) or 403(b) up to annual limit
- Taxable account
Following is a discussion of the rationale for these priorities.