Your retirement account provides good asset protection. However, as soon as you pass that account to a loved one, the associated protection evaporates. This means that just one lawsuit can make the entire thing disappear! If this occurs, your life-long, hard-earned savings could be wiped out, leaving your heirs penniless. But, never fear. Your estate attorney has a special tool in his arsenal to solve the problem. It’s called a “Standalone Retirement Trust” (SRT). An SRT can protect inherited retirement accounts from your beneficiaries’ creditors. How an SRT Works
When your spouse, child, or other loved one inherits your retirement account, believe it or not, their creditors have the power to seize the funds. If you’re like most people, you would want to do whatever you can to protect your retirement account to benefit your family members rather than their creditors.
5 reasons to protect your retirement account:
- Substantial combined retirement plans
Spouses can use an SRT to shield one or the other from creditors.
- Your beneficiary might be “less than frugal” with the funds
Anyone concerned about how their beneficiary will spend an inheritance should absolutely consider an SRT as it can provide oversight and instruction about how much funds will be received and when. - Concern about lawsuits, divorce, or other possible legal action
If your beneficiary is part of a lawsuit, is about to divorce, file for bankruptcy, or is involved in any type of legal action, an SRT can protect the inherited retirement accounts from those creditors. - Beneficiaries who receive assistance
If one of your beneficiaries receives, or may qualify for, a need-based governmental assistance program, inheriting from an IRA could cause them tolose such benefits. We can draft an SRT to avoid disqualification.
- Children from a previous marriage
Remarried with children from a previous marriage? Don’t let your spouse intentionally (or even unintentionally) disinherit your children. This way, you can eliminate the potential for this by naming the spouse as a lifetime beneficiary of the trust and then having the remainder pass onto your children from a previous marriage after your spouse’s death.
You’ve Worked Hard to Protect & Grow Your Wealth – We Can Help You Keep It That Way
We know you have worked hard to earn and save the money in your retirement accounts. And your beneficiaries’ creditors shouldn’t be able take those monies from them. Finally, call us today so we can show you how an SRT can help you protect your assets as well as provide tax deferred growth.
About Skvarna Law
We can help you make important estate-related decisions. Contact us today to learn about your options (909) 608-7671. We operate offices in Glendora and Upland, California. We provide legal services for individuals living in San Bernardino, Los Angeles, Orange and Riverside Counties. This includes the cities of Upland, Ontario, Rancho Cucamonga, Fontana, Colton, Rialto, Chino, Chino Hills, Glendora, Claremont, Montclair, Pomona, La Verne, San Dimas, Azusa, Covina, West Covina, Diamond Bar, Walnut, La Puente, Corona, Norco & Mira Loma. Visit SkvarnaLaw.com to learn more.
