You Inherited an IRA: Now What? Ep #14

<p>What do you do if you inherit your Mom’s IRA? What if it’s a Roth IRA? How does it have to be distributed? What’s the best way to handle the resources? In this episode of Retirement Made Easy, I’ll let you know how you can handle an inherited IRA (and how the SECURE Act comes into play).</p> <h2>You will want to hear this episode if you are interested in...</h2> <ul> <li>[1:43] How to handle inheriting your Mom’s IRA</li> <li>[5:27] Should you take a withdrawal?</li> <li>[6:30] The impact of the SECURE Act</li> <li>[10:01] Is inheriting a Roth IRA different?</li> <li>[14:11] Other important factors to consider</li> <li>[15:48] Why you can’t transfer to your own IRA</li> </ul> <h2>How to handle inheriting your Mom’s IRA</h2> <p>If your mother passes away and you’re the beneficiary of her IRA, where do you start? I recommend that you contact the custodian of the IRA (Fidelity, Charles Schwab, i.e. whatever name is on the statement). You call the 800 number and let them know that your Mom passed away and ask what your next steps are. </p> <p>They’ll likely give you some forms to submit to them with a copy of the death certificate (I always recommend getting a few extra copies of the death certificate—you’ll probably need it). When you submit the paperwork, they open a Beneficiary IRA in your name. At that point, the assets are transferred from your Mom’s IRA to yours. <em>Be absolutely sure that you’re designating beneficiaries for your account</em>. </p> <p>These forms are tricky and a pain-in-the-neck. If you have a financial advisor, get their help to make sure you’re handling it correctly. It often requires a medallion signature or notary stamp. Once it’s set up, you’ll be able to invest this account however you decide. Since it’s an IRA you can change the investments to suit your goals. </p> <h2>How withdrawals from an inherited IRA work</h2> <p>Do you have debt you want to pay down? Maybe you want to pay off your home earlier? An inherited IRA brings more resources to the table that you can draw from to pay