Do you have a retirement plan? You probably do. In fact, you may even have more than one.1
While retirement plans are commonplace, many plan participants have a hard time answering a common question: who should they designate as the account beneficiary?
Who have you chosen to inherit those funds? Can you imagine what would happen if the money in your retirement plan went to someone from whom you were estranged? Or if your heirs found out that you never named a beneficiary in the first place?
This occurs more often than you might think – and a little attention to detail today may help to prevent surprise or disappointment later.
When was the last time you looked at your beneficiary forms? Decades may have passed since you opened your retirement plan. Back then, you presumably filled out a form stating who you wanted those assets to go to if you pass away. Even factoring in the hunt for a beneficiary’s Social Security number, it might have taken you all of ten minutes to complete.
In that moment, you may have made one of your biggest estate planning decisions. You need to make sure your decision is still the right one.
I’ll provide you with a complimentary review of your retirement plan beneficiary designations. It is vital to make sure that your retirement plan funds will go to whom you wish in the case of your passing. As a complimentary service to the community, I provide beneficiary reviews and explain a lot of the “fine print” when it comes to the timeline of the assets distributions. I also let people know about their choices when they inherit retirement plan funds – you have to be very careful when managing these situations because they may potentially yield substantial tax consequences. Call me or email me – I’m happy to help out.2
1. Under the SECURE Act, once you reach age 72, you must begin taking required minimum distributions from your 401(k) or other defined-contribution plans in most circumstances. Withdrawals from your 401(k) or other defined-contribution plans taxes as ordinary income and, if taken before age 59½, may be subject to a 10% federal income tax penalty.
2. Under the SECURE Act, your required minimum distribution (RMD) is required to be distributed by the end of the 10th calendar year following the year of the Individual Retirement Account (IRA) owner's death. Penalties may occur for missed RMDs. Any RMDs due for the original owner must be taken by their deadlines to avoid penalties. A surviving spouse of the IRA owner, disabled or chronically ill individuals, individuals who are not more than 10 years younger than the IRA owner, and child of the IRA owner who has not reached the age of majority may have other minimum distribution requirements.
The content is developed from sources believed to be providing accurate information. The information in this material is not intended as tax or legal advice. Please consult legal or tax professionals for specific information regarding your individual situation. This material was developed and produced by FMG Suite to provide information on a topic that may be of interest. FMG Suite, LLC, is not affiliated with the named representative, broker-dealer, state- or SEC-registered investment advisory firm. The opinions expressed and material provided are for general information and should not be considered a solicitation for the purchase or sale of any security.