April 7, 2016

In a recent decision from the Supreme Court, IRAs are no longer classified as protected retirement funds which means that they could be subjected to creditors’ claims if the beneficiary filed for bankruptcy. In the case of bankrupted estates, inherited IRAs could now be classified as assets, meaning that they would be fully accessible to satisfy creditor claims. If you pass a retirement fund down to a grandchild or a child, you need to think carefully about whether you need to take additional steps to protect those funds.

In some situations, putting together a tool like a stand-alone retirement trust can help to protect your asset without minimizing your beneficiary’s access to those assets. Set up a meeting with an estate planning attorney so that your will can be drafted carefully in order to avoid potential challenges and to be set up so that it carries out your wishes.

Planning ahead is one of the most important things you can do whenever you have plans of passing on assets to a future generation. There are many different strategies and tools available for estate planners today that can help you accomplish these goals.