As part of the overall theme of our channel, we do our best to focus on educating and communicating. A couple of weeks ago we put out a video on the secure act and the implications of this.

As a follow-up to that video, we have done another video with suggestions and ideas on how to deal with the new secure act.

This is a good time to review your financial plan and see if you and your family are impacted. We do have a special offering for wealth and wisdom viewers, there is a link below to schedule your appointment today!

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LEARN MORE ABOUT: IRA Accounts

CONVERTING IRA TO GOLD: Gold IRA Account

CONVERTING IRA TO SILVER: Silver IRA Account

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As of January 1, 2020, the SECURE Act has effectively killed the Stretch IRA, a popular estate planning strategy that allowed beneficiaries to stretch out the distributions of an inherited IRA over their lifetime. Under the new law, most non-spouse beneficiaries are required to withdraw the funds from an inherited IRA within 10 years of the original account holder’s death.

This change has significant implications for those who have utilized the Stretch IRA as part of their estate planning strategy. Here are some alternative strategies to consider in the wake of the death of the Stretch IRA:

1. Roth conversions: If you are able to, consider converting your traditional IRA to a Roth IRA. While you will have to pay taxes on the converted amount, any distributions from a Roth IRA, including those to beneficiaries, are tax-free. This can be a more tax-efficient option for passing on your retirement savings.

2. Charitable giving: Consider naming a charity as the beneficiary of your IRA. Charities are exempt from income taxes, so they can receive the full value of your account without any tax consequences. This is a great option if you are philanthropically inclined and want to leave a lasting impact.

3. Life insurance: Another option is to purchase a life insurance policy to provide for your beneficiaries. The death benefit from a life insurance policy is typically tax-free, providing a tax-efficient way to pass on wealth to your loved ones.

4. Qualified charitable distributions (QCDs): If you are 70 ½ or older, you can make a qualified charitable distribution directly from your IRA to a charity. This distribution counts towards your required minimum distribution (RMD) for the year and is excluded from your taxable income. While this option won’t benefit your heirs directly, it can be a tax-efficient way to support causes you care about.

5. Trust planning: Setting up a trust can help you control how your assets are distributed after your death. While trusts are subject to the same 10-year distribution rule as individual beneficiaries under the new law, they may provide additional benefits such as creditor protection and control over how the assets are managed.

It’s important to review your estate plan in light of the changes brought about by the SECURE Act. Consult with a financial advisor or estate planning attorney to determine the best strategies for passing on your retirement savings in a tax-efficient manner. While the death of the Stretch IRA may be disappointing for some, there are still plenty of options available to help you achieve your estate planning goals.