Funding A Legacy: Three Ways To Get Creative

Oct 05

Leaving a legacy for children or grandchildren is often a strong motive for creating an estate plan. But it doesn’t have to be a simple cash bequest that you must carve out now. There are many ways to structure your existing estate so that you have the benefit now but can still leave a meaningful legacy to those you love.  And there are often tax benefits. We look at three strategies.

Setting Up a Beneficiary IRA

Both traditional IRAs and Roth IRAs allow for multiple beneficiaries. After the death of the donor, the IRA is divided into separate accounts for each beneficiary. These separate accounts can be accessed independently. Beneficiaries have five years to either take the money out of the account or transfer the plan to an Inherited IRA that allows for stretch distributions.

Naming a Child as Beneficiary to an Annuity

Purchasing an annuity and naming a child as beneficiary provides an... ...