Consider Your Options Carefully When Selecting the Beneficiary of Your IRA

Were you aware that the selection of the beneficiary of your Individual Retirement Account or "IRA", could have a big effect upon its value in the future? 

If you have an IRA, you are probably aware that once you reach a certain age you are required to take mandatory distributions from your IRA.  However keep in mind that these are minimum mandatory distributions, you are not required to spend the entire balance.  If you do not withdraw all of the money from your account before your death, it will pass to your beneficiary; and, depending upon who you have named as the beneficiary, the balance in your account can continue to grow in a tax deferred manner for many years into the future.   Consequently a person of modest means can grow their IRA to a significant estate for their family and loved ones.

Your choices for beneficiary include a spouse, children, grandchildren, other individuals, charities, or a trust.  Each choice has benefits and detriments so be sure to weigh your options carefully.  We recommend that you talk with an estate planning attorney as well as your family accountant, or financial professional before making your final choice.