Area of Practice
Retirement Asset Planning
Retirement planning entails establishing retirement income objectives and identifying what is required to accomplish them. Planning for retirement involves analyzing sources of income, estimating spending, developing a savings program, and managing assets and risks. Future cash flows are calculated to assess the feasibility of the retirement income goal.
Our Services Include:
- Beneficiary designations preparation
- Drafting unique provisions in trust to accommodate retirement assets
- Assistance with the titling of assets
At Endacott Timmer, our main goal is to ensure that your final desires and beneficiaries are protected. We monitor all developments in estate taxes and probate avoidance to help you carry out your preferences tax-wise and efficiently.
Common Retirement Planning Questions
Retirement planning is a crucial component of ensuring you can retire with peace of mind. Explore the common questions we get around retirement asset planning and reach out to us with any other questions you may have.
1
Who should I name as the beneficiary on my retirement plan assets?
These assets will be distributed to the person you choose as your beneficiary in your retirement plan. If there are designations in a will, they will not take precedence over the designations in your retirement plan. When it comes to selecting a beneficiary, you have several options (and some limitations). Here are some considerations:
- Spouse
- Children
- Close family member
- Trust
- Charity or nonprofit organization
2
Can I name a trust as beneficiary?
A trust can provide you greater control over the distribution of your possessions. A trust can be designated as the direct beneficiary of an account. Your assets are transferred to the trust upon your death, and payments are given to the trust’s beneficiaries in accordance with your instructions.
3
What is the RMD and how is it determined?
Required minimal distributions (RMDs) are typically minimum amounts that a retirement plan account owner must withdraw yearly beginning in the year he or she turns 72, or, if later, the year he or she retires. In general, an RMD is determined for each account by dividing the previous December 31 balance of the IRA or retirement plan account by an IRS-published life expectancy figure.
Case Study: Retirement Asset Planning
Introduction
Our client owns a large retirement account as her primary asset. She wishes to leave her accumulated wealth to her children and grandchildren.
Problem
One of her children has significant creditor problems and several of her grandchildren are minors. She understands that any gift that goes directly to her child with creditor problems will likely be confiscated by the creditors, and leaving significant wealth to a minor may necessitate a conservatorship, an expensive and potentially multi-year court proceeding. Lastly, retirement accounts are subject to complicated distribution and tax rules.
Solution
We worked with our client to determine how she wants to divide her estate and retirement account among her children and grandchildren and learned how she wants the funds used for their benefit. We then prepared trusts that will receive the retirement account and other assets for her child with creditor problems as well as her minor grandchildren. The trusts allowed her to avoid a conservatorship for the grandchildren, provide oversight of the funds in a tax-efficient manner, and make the funds available for her grandchildren for appropriate purposes until they reach the age of majority. The trust for the child with creditor problems will protect the inheritance from creditors, while making funds available for her child’s needs, all in a tax-efficient manner.