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Inheriting Money? Know Your Options...

Inheriting Money? Know Your Options...

October 28, 2022

Inherited retirement accounts offer great financial opportunities to beneficiaries, but can be stressful due to the complicated risks associated with certain options. Knowing the basic differences of each option is just the tip of the iceberg, but it will help you get a feel for the four main choices that lay in front of you.

Whether you’re a spouse or a financial dependent of the deceased, you may quickly realize that their passing is about to put a big financial strain on your finances. In these situations, transferring the funds to a new inherited IRA can be a better option.

Your 4 Options Simplified

  1. Transfer the funds to your existing account (spouses only).
  2. Transfer the funds to an Inherited IRA.
  3. Take a lump sum of the funds now.
  4. Choose not to take the funds.

Consider a situation that with their passing comes a loss of income that typically pays for the mortgage, other monthly bills and/or even college tuition payments. If so, you need a flexible way to access funds. By opening an Inherited IRA in your name, it makes the funds readily available without penalties for early withdrawal and still grows the remaining funds tax-deferred.

Transferring inherited money into an Inherited IRA is also a great option for younger beneficiaries. Why? Because a new Inherited IRA allows the money to grow tax-deferred, potentially for decades, converting a modest inheritance into a sizable estate.

Again, the fine print that goes along with this option isn’t always simple. Please feel free to forward this to someone with these circumstances that may be wondering what to do.

But I can lay it all out for you and make sure it’s as easy a transaction as possible.

Use the Calendar Link or the QR code to make some time to discuss your options.

I'm here to listen and help.