352.372.1011Gainesville, FL
CONTACT
Share

Gainesville, FL Estate Planning, Will & Trust Law Blog

Monday, November 5, 2018

Reasons to Protect Your Retirement Accounts Now

Reasons to Protect Your Retirement Accounts Now

During your lifetime, your retirement account has good asset protection, but as soon as you pass that account to a loved one, that protection may evaporate. Although some states (including Florida) protect inherited IRAs, your beneficiaries may live elsewhere. Depending on the state of residence of your named beneficiary, this means one lawsuit and POOF! Your life long, hard earned savings could be gone. Your heirs could be left penniless.

Fortunately, there is a solution to this problem.  A special trust called a “Standalone Retirement Trust” (SRT) can protect inherited retirement accounts from your beneficiaries’ creditors.  

When your spouse, child, or other loved one inherits your retirement account, their creditors have the power to seize it and take it as their own. 

If you’re like most people, you’re thinking of protecting your retirement account so your family can benefit - rather than the creditors. Here are some reasons to protect your retirement account:

 

1. You believe your beneficiary may be “less than frugal” with the funds.  Anyone concerned about how their beneficiary will spend the inheritance should absolutely consider an SRT as you can provide oversight and instruction on how much they receive – and when. Often a beneficiary's first impulse is to withdraw the plan assets, thereby accelerating income tax and exposing the proceeds to judgment creditors or divorcing spouses. 

 

2. You are concerned about lawsuits, divorce, or other possible legal actions.  If your beneficiary is part of a lawsuit, is about to divorce, file for bankruptcy, or is involved in any type of legal action, an SRT can protect the inherited retirement accounts from those creditors.  

 

3. You have beneficiaries who receive assistance.  If one of your beneficiaries receives, or may qualify for, a need-based governmental assistance program, it’s important to know that inheriting from an IRA may cause them to lose those benefits. An SRT can be drafted to avoid disqualification.  

 

4. You are remarried with children from a previous marriage.  If you are remarried and have children from a previous marriage, your spouse could intentionally (or even unintentionally) disinherit your children.  You can avoid this by naming the spouse as a lifetime beneficiary of the trust and then having the remainder pass onto your children from a previous marriage after your spouse’s death.

 

You’ve Worked Hard To Protect & Grow Your Wealth – Let’s Keep It That Way

You worked hard to save the money in those retirement accounts and your beneficiaries’ creditors shouldn’t be able take it from them. Give us a call and let us show you how an SRT can help you protect your assets as well as provide tax deferred growth. 


Archived Posts

2019
2018
2014
2013


From our office in Gainesville, the estate planning firm of White, Crouch & Mills, P.A. advises and represents clients in communities throughout Alachua County, Marion County, Levy County, Putnam County, Clay County, Bradford County, Union County and Gilchrist County in North Central Florida. Call us at 352-372-1011 or contact the firm by email to arrange an initial consultation with us today.



© 2019 White, Crouch & Mills, P.A. | Disclaimer & Privacy
5303 SW 91st Drive, Suite 200, Second Floor, Gainesville, FL 32608
| Phone: 352-372-1011

Estate Planning | Asset Preservation | Estate Taxes | Trusts | Advance Directives | IRA Planning | Special Needs Trusts | Disability Planning | Probate | Pet Trusts | Business Law | Business Planning | About Us | Firm Overview

FacebookLinked-In PersonalLinked-In Company

Law Firm Website Design by
Zola Creative