The Dating Game, How Well Do You Know Your IRA?

June 6, 2013 - PRLog -- Recently my wife Becky and I were playing the game the cube. It's a game that consists of a few simple questions and your imagination. The goal of the game is to get to know yourself and your spouse better. This was the first time we had ever played the game and we were surprised by some of our own answers as well as the answers of each other. What we took away was that we know each other pretty well but there's always something new to learn.

Weird comparison but the same goes true for one of the most widely recognized retirement vehicles the IRA. So we're going to play a game like the old dating game, a few simple questions to determine how well we know our IRA.

An IRA can pass directly to your beneficiary not by a Will or a Trust. When you open your IRA accounts you name primary and contingent beneficiaries, usually these are spouses and children. When you pass away the IRA account goes directly to the named beneficiary. One thing that's important to note is no matter what your Trust or Will documents say.

Another thing to take note of is IRAs cannot be owned by a Trust while you are here on this earth. The breakdown of IRA is Individual Retirement Account, it has to be owned by you the individual. If you change the title to being owned by a Trust the full amount is taxed in that year, devastating! It is also often advised not to place a Trust as the owner of your IRA if you are married or have children because of the information stated in the above paragraph. If your wish is for your child to receive your IRA, the best option usually is to have the account pass on to them directly rather than have it pass through a Trust and be taxed.

IRAs have one of the heaviest taxations of any vehicle. If you own a stock and it generates dividends you may be taxed on those below your current tax bracket. However, when the IRS looks at the funds withdrawn from an IRA they view every dollar as ordinary income. So if you're in a high tax bracket withdrawing funds from an IRA instead of a non qualified account could be a tax burden. IRAs often need their own estate and tax evaluation because they are treated so differently with different rules.


Matt Golab was recruited to write a chapter in Tom Hopkins upcoming book, Victory scheduled to be released later this year. Matt also received the Editors Choice Award for his contribution to Victory, not every contributor is selected for this high honor.

Matt is an authority on creating innovative tax and investment solutions to help his clients succeed in their retirement years.  The strategies Matt Golab has established and passed on through successful financial planning with hundreds of clients over the years has launched him into the national spotlight. He is often featured in Senior Market Advisor Magazine, a publication which attracts the top financial planners in the country. Matt has been featured in newspapers around the country passing on the principals for a successful retirement. Golab is often asked by national websites that focus on the education of consumers to present his knowledge on the areas of retirement and retirement income plans. Matt is frequently featured in The Wall Street Journal, CNBC, MSN Money, The San Francisco Chronicle,  Newsweek, TheSmartRetiree, Burlington County Times and soon will be appearing nationwide on ABC, CBS, Fox, and NBC as well as USA Today.

Golab is the Author of The Consumer's Guide to Planning Your Retirement: Your Guide to Mental Peace and Financial Well Being. Matt Golab continues to expand the geographic reach of his audience and desires to bring his expertise to a nationwide television audience. Matt emphatically states his mission, “I want to change the way Americans view their retirement. They can succeed (stay retired) regardless of what happens in the market". Contact information for Matt is available at his website,

http://www.aaronmatthewsfinancial.com/

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