Ask Terry Questions Executor of a will

Executor of a will

By Terry Savage on September 20, 2021 | Financial Planning / Retirement

I’m married and 65 years old with some health issues. My wife and my names are on our 401k, IRA and Roth IRA accounts jointly. My son-in-law is the executor of our will. Should his names also be on the accounts? Would that cause a tax problem for him? After our deaths will there be a problem in administrating our retirement accounts if the accounts are just in our name?

Terry Says

Whoa — your question shows some huge gaps in your knowledge that could be costly — unless I misunderstand what you wrote.
First, you should name a beneficiary for each of your retirement accounts. You can name a primary beneficiary, likely your spouse. And then you can name a “secondary” beneficiary –your son — to make this automatic if your spouse should predecease you. Or you could make them both primary beneficiaries –splitting the balance at your death. Make sure you have done this correctly for each of your IRAs. And she must do this for her IRA and 40l(k) accounts.
But the accounts CURRENTLY remain in each of your individual names.

You said your son-in-law is the executor of your will. That means he is in charge of distributing all of your assets — EXCEPT for your retirement accounts, which pass outside your will and directly to the named beneficiaries.

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