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Is a Roth IRA the “Cadillac” of Assets to Leave for Heirs?

June 13, 2014

Filed under: Asset Protection,Asset Protection Planning,Asset Protector — Neel Shah @ 12:07 pm

If you’re looking down the road to retirement, you may be wondering which of your accounts you should tap into first, and which you should leave possibly set aside to pass on to beneficiaries. Those individuals with traditional retirement accounts, brokerage accounts, Roth IRAs, and a 401k may feel overwhelmed by the options, but it all depends on your estate planning goals.

Is a Roth IRA the Cadillac of Assets to Leave for Heirs
(Photo credit: barrett-jackson.com)

For the most part, Roth IRAs seem to be good accounts to leave behind for others. Since the distributions can be taken out tax-free and can be stretched over the course of a lifetime, the majority of the original investment can continue growing tax free during that same period. Since the federal estate tax exemption for a married couple is more than $10 million, Roth IRAs may be more likely to be free of estate taxes and income taxes. For that reason, it could be worth your time to convert other traditional retirement accounts into a Roth for the ultimate benefit or heirs.

Doing so, however, requires understanding that you’re probably going to have to leave that money alone for at least ten years, so don’t make a decision without careful consideration of your own cash flow situation. If you convert and begin taking income out, the potential growth for that IRA is halted. To learn more about estate planning strategies that leave a legacy behind for family, call us at 732-521-9455.

Are You a Sitting Duck? Four Asset Protection Strategies to Consider

February 25, 2014

Filed under: Asset Protection Planning,Asset Protector,Estate Planning,Insurance,LLCs — Neel Shah @ 10:00 am

Many investors are so focused on their return on investment that they fail to consider or implement asset protection strategies. As a recent article explains, an investor who has not protected his investments is a mere sitting duck. If you haven’t considered asset protection for your investments, below are four strategies you should consider:

Duck

(Photo credit: Wikipedia)

    1. Insurance: This is an important part of any asset protection plan because it shifts the risk of loss to somebody else. Insurance can be purchased for almost any asset or activity.

    2. Wait for Social Security: Social security is an important safety net for an individual or couple as they age. By waiting as long as possible before withdrawing benefits, an individual or couple can increase their ultimate return.

    3. Execute and Update an Estate Plan: An estate plan accomplishes many tasks. Not only does it provide for your loved ones after your death, but it can also utilize various tools to reduce the tax liability on your estate and your heirs.

    4. Consider Business Ownership for a Favorable Tax Rate: Ownership of assets by a business entity rather than an individual often means a lower tax liability on the assets. If you have a home business or simply a large amount of assets, consider forming a corporate entity to lower your tax liability.

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