IRAs, 401k, 403b
Your IRA, or 401(k), is most likely your largest financial asset and you are counting on it for retirement income. The most costly mistake in managing this money is not in how it’s invested, it’s account transfers or rollovers, beneficiary designations, and required minimum distributions.
If one wrong transaction is made with an IRA or 401(k), it is most likely irreversible and causes tax liabilities and possibly penalties.
Questions we can answer
How do I turn my IRA or 401(k) into a pension?
You can turn your IRA or 401(k) into a pension by purchasing an annuity that provides guaranteed monthly income for life, or by setting up systematic withdrawals to create your own steady paycheck. Many retirees blend the two—using part for guaranteed income and keeping the rest invested for flexibility and growth.
What are my Required Minimum Distributions?
Required Minimum Distributions (RMDs) are the minimum amounts the IRS requires you to withdraw each year from your tax-deferred retirement accounts—like traditional IRAs and 401(k)s—once you reach a certain age. To calculate your RMD, take your retirement account balance from December 31 of the previous year and divide it by the IRS life expectancy factor for your age.
What about my Roth IRA? Should I consider a Roth IRA conversion?
A Roth IRA conversion lets you move money from a traditional IRA to a Roth, paying taxes now in exchange for tax-free growth and withdrawals later. It can be smart if you expect higher future tax rates, have cash to cover the tax bill, or want more flexibility and tax-free income in retirement.
Who should my IRA beneficiary be?
The “right” choice depends on your goals. Your IRA beneficiary should be someone who both benefits from the account and fits well with your overall estate and tax plan. For most people, a spouse is the primary beneficiary because they can roll it into their own IRA, while children or other heirs are often listed as contingent beneficiaries to inherit under the 10-year rule.
Should I plan to leave my IRA to my heirs?
You can leave your IRA to heirs, but most non-spouse beneficiaries must empty the account within 10 years, which can create a heavy tax burden. Strategies like Roth conversions, naming a spouse, or giving to charities can help reduce taxes and provide more control.
IRAs = Retirement Income
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