One of the most important, but often overlooked, aspects of financial planning is deciding how to transfer your wealth to loved ones or causes you care about. It’s not just about leaving assets behind—it’s about doing so efficiently, minimizing taxes, and ensuring your wishes are honored.
How will you transfer your retirement wealth to your spouse, children, grandchildren, or charities? Proper planning ensures that your hard-earned savings not only reach the intended recipients but also maintain their value.
Many assets, including retirement accounts like 401(k)s and IRAs, may be subject to taxation when inherited. Naming beneficiaries directly on these accounts can simplify the transfer process and help to avoid probate, but careful thought must go into how to structure these distributions. Make sure your beneficiaries are up to date and you have named beneficiaries on your accounts.
Spouses often have the option to roll over inherited retirement accounts into their own name, deferring taxes.
Setting up trusts can help ensure your assets are managed and distributed over time, potentially lowering the tax burden.
Donating directly from retirement accounts through Qualified Charitable Distributions (QCDs) can reduce taxable income.
Make sure your estate plan reflects your intentions. Regularly review and update your beneficiary designations, will, and trust documents to account for life changes like marriage, divorce, or new children. It’s also a good idea to communicate your intentions with your family so there are no surprises.
By taking these steps, you can transfer wealth in a way that reflects your values and protects your loved ones, ensuring your legacy is appreciated, not burdened by taxes or uncertainty.
We help people everyday with basic estate planning and end of life planning. If you have been avoiding this, need help, or have questions, then let's talk.
Your Wela Financial Advisory Team
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Brent Forrest & Associates, LLC. dba Wela Financial Advisory (Wela) is a registered investment adviser. The information presented is for educational purposes only. It should not be considered specific investment advice, does not take into consideration your specific situation, and does not intend to make an offer or solicitation for the sale or purchase of any securities or investment strategies. Investments involve risk and are not guaranteed. Be sure to consult with a qualified financial adviser and/or tax professional before implementing any strategy discussed herein. This article and images may have been enhanced by utilizing artificial intelligence (AI). Brent Forrest & Associates, LLC dba Wela Financial Advisory (Wela) is a registered investment adviser. The information presented is for educational purposes only and is not intended to make an offer or solicitation for the sale or purchase of any specific securities, investments, or investment strategies. Investments involve risk and, unless otherwise stated, are not guaranteed. Be sure to first consult with a qualified financial adviser and/or tax professional before implementing any strategy discussed herein. Past performance is not indicative of future performance. Wela may discuss and display, charts, graphs, formulas which are not intended to be used by themselves to determine which securities to buy or sell, or when to buy or sell them. Such charts and graphs offer limited information and should not be used on their own to make investment decisions
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