Estate Planning

How to Control Your Retirement Accounts after Your Death

More and more people own retirement accounts that are connected in some way to IRAs.  It’s also true that nearly half of the married people in the country used to be married to someone else.  If you have kids from a previous marriage, you might be nervous about your wife and those kids fighting over your retirement account when you’re gone.

Many people phrase the problem this way: “I want my spouse to have access to my IRA account, but I am fearful my children could end up getting cut out if I name my spouse as the primary beneficiary of my IRA.  After all, the relationship between my children and my spouse has never been great.”  

There’s good news for people in this situation.  Recently, lawyers have developed a kind of trust that is designed to fix this problem.  It’s called a Standalone Retirement Trust, or SRT for short.  

How does it work?

Instead of naming your spouse as the beneficiary of your IRA, you name the SRT as beneficiary.  That means, when you die, your retirement account pays out to the trust. In the terms of the SRT, you can map out how you want the funds in your retirement account to get distributed.  So, instead of naming either your spouse or your kids as the primary beneficiary, and hoping that they share, you can name the SRT as the beneficiary and outline how much everyone gets.

Why do I need an SRT if my second wife gets along with my kids from my other marriage?

Your kids and your second spouse may get along great now.  You have no idea what’s going to happen after you pass away and money is involved. Also, what happens if your spouse’s mental health declines as they age?  Do you want to worry about your spouse changing the beneficiary on your IRA after your gone? Why worry about it? Plan instead.

SRT planning can be complex.  We know how to handle your situation.  Please give us a chance to give you peace of mind and call us today or make an appointment with an estate planning attorney here.

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