The Mendel Law Firm
The Mendel Law Firm
If you have already started planning for your “Golden Years” then you know how complicated retirement planning can be. One mistake you want to avoid with your retirement plan is failing to incorporate those plans into your overall estate plan. For example, if you have an IRA, a 401(k), or another type of retirement account, factoring that account into your comprehensive estate plan prevents a conflict down the road. Moreover, by integrating your retirement plans into your estate plan you maximize the benefits of both plans. Of course, the often complex tax laws and regulations that must be considered when integrating your plans can make doing so a challenge which is one of the many reasons why you should work closely with an experienced IRA and Retirement Planning attorney.
The Need for IRAs, 401(k)s and Other Retirement Accounts
For those in the younger generations, the need to fund your own retirement has always been a given; however, self-funded retirement plans were not always the norm. Not all that long ago, workers took company funded retirement benefits and pensions for granted. Those expectations, however, went by the wayside along with the concept of lifetime employment. Faced with the need to plan for their own retirement, self-funded options such as Individual Retirement Accounts (IRAs), 401(k)s, and other tax deferred retirement accounts have become increasingly popular with workers. The number of different IRAs and other types of retirement accounts continues to grow. As those options expand, the I.R.S. tax rules and regulations that govern them become more complex. One wrong step while navigating those rules and regulations could have profoundly negative consequences. Failing to understand how your tax-deferred (as opposed to tax-free) account will impact your finances during your retirement years, for example, could seriously threaten your retirement nest egg.
Integrating Your Retirement Plan into Your Estate Plan
If you are like most people, a primary goal of your estate plan is to protect and preserve assets throughout the course of your lifetime so that they can be passed down to the next generation at the end of your life. The goal of your retirement plan is much more narrow – to ensure that you have enough assets available to live comfortably during the autumn of your life. It should be clear that your retirement plans will have a direct impact on your estate plan. Consequently, integrating your retirement plans into your comprehensive estate plan is essential.
Because you will stop working at some point, you will eventually depend on existing assets and retirement accounts to support you during your retirement years. Withdrawals from retirement accounts often trigger tax consequences as do the sale or transfer of assets. Failing to understand and plan for those tax consequences could result in a significant loss of assets toward the end of your life. That, in turn, diminishes the value of the estate you leave behind for loves ones when you are gone. The key to avoiding just such an outcome is to work closely with a Retirement Planning attorney to ensure that your retirement plans work in harmony with your estate plans.
The tax rules and regulations that apply to IRAs and other tax-deferred retirement accounts are complex and ever-changing. To ensure that you understand those rules and that they are given due consideration within your retirement and estate plans, it is in your favor to work closely with one of our IRA and Retirement Planning attorneys at The Mendel Law Firm, L.P. Contact the team today by calling (281) 759-3213 or fill out our online contact form.