inheritance funds in IRA
Both of my parents are deceased and my sister; as executor, is working through the accounts that my parents had and getting them split equally between the 2 of us. My first question is, is it better to have all of my funds at one institution(Charles Schwab), or to spread them out to a number of institutions(Fidelity, Vanguard)? My second question is , the funds that we have at Charles Schwab is a majority of the funds. Is it necessary to have a “wealth advisor”? Also, I do not understand the process/procedures for Required Minimum Disbursements. Are they just sent to me, or do I need to do something to get them? I have many more questions, but I will start with these.
Terry Says
OK, since neither of you is a spouse, Schwab will roll each of your shares into an “Inherited IRA.” And since they presumably had separate IRAs (unless one survived the other and had rolled the inherited IRA into a Spousal IRA!) you each might wind up with two separate inherited IRAs!!
Now, whether you must take distributions depends on whether they had started taking RMDs.
The first thing to know is that you MUST withdraw all the money in 10 years. Meantime, it continues to grow. So your own retirement plans and tax situation will have to be considered in making the decision of WHEN to take withdrawals from the inherited IRAs.
BUT if they had started taking distributions (RMDs), then you must continue to take ANNUAL distributions — but not as much as they were taking. This RMD will be based on YOUR life expectancy.
Schwab will help you calculate that!
There is no reason to move the inherited IRAs to another place. You’ll do just fine at Schwab. Just be sure to name a beneficiary for your new inherited IRA accounts.
And you don’t need an investment advisor. Just, based on your stage of life, invest conservatively. If you want an independent review of your entire financial plan, as well as help reviewing your investments, maybe a session with a fee-only FIDUCIARY advisor would be in order. Now that you have this money, you need to do your own planning.
Read this: https://www.terrysavage.com/pam-krueger-wealthramp/
