Discover the Estate Planning Tool You Never Knew You Needed

You may be familiar with IRAs. You may also be familiar with Trusts, but have you heard of the ‘trusteed IRA’? The Trusteed IRA is an elegant financial planning tool that combines the best of the IRA world with that of the Estate document world. Learn more about the tool that many financial planners and estate planning attorneys are raving about.

No question that millions of Americans are using IRAs to save for their retirement. An estimated 48.9 million U.S. households, or 40.4%, owned IRAs as of 2012. However, current trends show that IRA withdrawals will increase significantly over the next decade, both in dollar amount and as a percentage of total retirement income, as the baby boomer generation enters retirement.

The problem, however, from an inheritance point of view that arises for the IRA creator is that when he or she dies, the beneficiary can withdraw part or all of the IRA funds at that time. That is probably not what the IRA creator intended long term.

What if there was a way, however, to control the ultimate beneficiaries, a way in which one could designate contingent beneficiaries that could not be altered by the primary beneficiary?

Enter the trusteed IRA or ‘individual retirement trust,’ an estate-planning device, which gives people considerable control and flexibility over their IRA funds.

Give us a call or email us to get to know more about this device.

Nalini Mahadevan, Esq


This blog post is not intended as legal advice.


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Do Physicians Really Need Asset Planning?

A couple consulted me about writing a will and trust for their family. The husband is a doctor and the wife is a lawyer, both in private practice. They had two young children under the age of 18 and no prior marriages. Both carried malpractice insurance for their professions and an umbrella policy. They had good cars and a residence in a nice neighborhood. They also had retirement plans and mutual funds and children in private school. They were saving for college through 529 Plans.

They wanted to protect their families and assets from lawsuits and creditors. Missouri is a great asset planning state, but the planning to protect assets should start at least four years in advance—creditors can sue to set aside the transfer. Assets can be attached if the transfer (to another person or entity or trust) occurs and the lawsuit is filed within four years of the transfer.

The best way to protect assets is to transfer the asset to a trust, other entity, or person with no recourse to the owner. However, a house jointly owned by husband and wife is not protected in the event of a divorce the property, and can be divided between the parties. The creditors of the deceased spouse can also sue to recover from the sale of the residence. Hence holding assets in joint name may not always be the answer.

The 529 plans are not subject to federal income tax and can be paid in advance up to five years depending on the plan—and are excluded from the estate of the deceased—to offer asset protection. Professional and umbrella polices may be insufficient to satisfy creditors in a lawsuit, which means that protecting other assets becomes imperative.

See you in my next blog.

Nalini S Mahadevan, JD, MBA
Immigration Attorney St. Louis, Missouri


The information is not meant to create a client-attorney relationship. This blog is for informational purposes only, and is not a substitute for legal advice. Situations may differ based on the facts.

Copyright 2014. All rights reserved.

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