{"id":2859,"date":"2022-09-08T13:26:07","date_gmt":"2022-09-08T17:26:07","guid":{"rendered":"https:\/\/www.thewealthguardians.com\/staging\/3023\/?p=2859"},"modified":"2022-09-08T13:27:31","modified_gmt":"2022-09-08T17:27:31","slug":"tips-for-leaving-an-inheritance-to-family","status":"publish","type":"post","link":"https:\/\/www.thewealthguardians.com\/staging\/3023\/tips-for-leaving-an-inheritance-to-family\/","title":{"rendered":"Tips for Leaving an Inheritance to Family"},"content":{"rendered":"

<\/p>\"\"Make sure you think about potential disruptions and plan ahead of time<\/em>\n

Families inherit money and sometimes make the right moves investing and spending. Inheritances can also ignite disruption, divorce, and a host of bad behavior \u2013 far from the hopes and plans of the benefactor.<\/p>\n

What happens when you leave what\u2019s probably one of your biggest investments: your individual retirement plan?<\/p>\n

Your Retirement Assets<\/strong><\/p>\n

Perhaps most important, your estate plan must address potential disruptions: the U.S. tax code will almost certainly change, your heirs will experience life\u2019s normal challenges and opportunities and something you never considered may befall those you leave behind. Early death, disability and divorce all happen every day.<\/p>\n

You should probably leave your retirement assets to an individual. Such accounts include your:<\/p>\n

IRA or 401(k)403(b) if you worked for a school or tax-exempt organization, a simplified employee pension (SEP-IRA), or any of a number of other plans. The retirement plans must go to your spouse unless he or she signed away control of them after you married (prenuptial agreements do not apply here), permitting you to designate a different beneficiary. You can leave your IRA to any person you choose.<\/p>\n

Planning Ahead of Time is Key<\/strong><\/p>\n

What if you leave your retirement money to your estate instead of to a person? What if your beneficiary dies before you?<\/p>\n

In either case, your savings must be liquidated and distributed over the next five years. You also lose the ability to arrange stretched payouts over individuals\u2019 life expectancies \u2013 usually lowering future income taxes significantly. Plus it creates a potential marital asset for many recipients, newfound wealth that can evaporate in the wake of some future family tragedy or feud.<\/p>\n

You can use specialized trusts to help mitigate most risks, such as the danger of a family beneficiary blowing the inheritance. A number of vehicles exist for restricting a beneficiary\u2019s (irresponsible) access to the money. For example:<\/p>\n