Reasons To Start Protecting Your Retirement Accounts

You want your loved one(s) to benefit from your retirement account, not the creditors.

If you or your beneficiaries fall into any of these five categories, you should seriously consider using a standalone retirement trust (SRT) to protect your retirement accounts.

If you have substantial combined retirement plans, loved ones can use an SRT to shield the retirement plans from creditors.

2. Concerns With Beneficiary Spending

You should consider an SRT if you are concerned about how your beneficiary will spend an inheritance, as you can provide oversight and instruction on how much they receive and when.

3. Concerns About Legal Action

If your beneficiary is part of a lawsuit, is about to divorce or file for bankruptcy, or is involved in any type of legal action, a properly drafted SRT can protect the inherited retirement accounts from those creditors.

4. Your Beneficiaries Receive Assistance

If a beneficiary receives or may qualify for, a needs-based governmental assistance program, it is important to know that inheriting an individual retirement account may cause the beneficiary to lose those benefits. An SRT can be drafted to avoid disqualification.

5. Children From A Previous Marriage

If you are married and have children from a previous marriage, naming your spouse as the primary beneficiary of your retirement account could allow your spouse to intentionally (or unintentionally) disinherit your children, even if you named your children as the contingent (backup) beneficiaries on the account.

You can avoid this by naming your spouse as the lifetime beneficiary of an SRT and then having the remainder pass to your children from a previous marriage after your spouse’s death.

Interested in Working With Us?

If you need any help regarding your estate or other legal matters please reach out to us directly here and schedule a call with one of our paralegals on our scheduling page here.