Is Your Retirement Account at Risk?

You’ve spent your entire life building up your retirement account. It may even be the biggest asset you’ll leave behind for the people you love.

If that’s the case, you may want to consider creating a special trust designed specifically to receive your retirement account assets in the event of your death.

If you leave your retirement account to the people you love outright, simply by naming them as beneficiaries on your retirement account rather than through a special trust, there are risks –

1. Some studies indicate 80% of retirement account beneficiaries immediately liquidate the account and frivolously spend the assets. On top of using the assets in ways you may not agree with, they also lose significant tax benefits for these assets you worked so hard to create.
2. If your beneficiary is married and doesn’t properly handle the retirement assets you leave behind, and gets divorced, your hard-earned assets could end up in the hands of the future ex-spouse of your beneficiary.
3. If you are in a second marriage with children from a prior marriage, you may be setting your spouse and children up for conflict after you’re gone because of the way you’ve planned (or not planned) for the passage of your retirement account.
4. If your beneficiary is ever in a situation where he or she has creditors or may have to file bankruptcy and you’ve left your retirement account to him or her without a special trust, your retirement account would go to satisfy those creditors first.

The good news? With the right planning, it’s not hard to protect your retirement account for your beneficiaries. At Snake River Law, we use a variety of special trusts to ensure the retirement assets you’ve worked hard to build up throughout your life are correctly passed on to the people you love. These assets can be totally protected from a future divorce, creditors and bankruptcy.

If you have a significant retirement account whose designated beneficiary is your spouse, children or even your regular revocable living trust, call us to have your planning reviewed immediately.

This article is a service of Mark Petersen at Snake River Law, Personal Family Lawyer®. We do not just draft documents; we ensure you make informed and empowered decisions about life and death, for yourself and the people you love. That’s why we offer a Family Wealth Planning Session™, during which you will get more financially organized than you’ve ever been before and make all the best choices for the people you love. You can begin by calling our office today to schedule a Family Wealth Planning Session and mention this article to find out how to get this $750 session at no charge.