scurryParticipantStatus: PhysicianPosts: 45Joined: 03/28/2016
I am in the process of setting up a family trust. We live in California. Can someone answer the following questions:
1. Do retirement accounts need to be placed in a trust (401k, SEP, IRA, etc)?
2. Do brokerage accounts, HSA, 529, cash balance plans need to be placed in a trust?
I’ve read conflicting things regarding what needs to be placed in trusts. For example, ive read that 401k and IRAs shouldnt because doing so can trigger a tax event.
Also, if I have already named beneficiaries for all the accounts, do i still need to place them in a trust?
Thanks in advance!February 13, 2019 at 9:45 am MST #190470bean1970ParticipantStatus: PhysicianPosts: 550Joined: 07/12/2017
we only have stuff in our trust where there is no named beneficiary (brokerage accounts and home). That is the bulk of our net worth (brokerage accounts, home not so much).
there are some quirks with having retirement accounts and IRAs in trusts. we were advised againstFebruary 13, 2019 at 10:44 am MST #190499PedsModeratorStatus: PhysicianPosts: 4458Joined: 01/08/2016
only items that do not have a beneficiary as that overrules everything.February 13, 2019 at 12:25 pm MST #190524Larry RagmanParticipantStatus: Other ProfessionalPosts: 617Joined: 08/30/2018
While I generally agree with bean1970, I recommend James Lange’s “Retire Secure” to discuss some of the options for trusts. For example, he would not recommend putting retirement accounts in a trust, but he would make a trust the contingent beneficiary of retirement accounts.CordMcNallyParticipantStatus: PhysicianPosts: 2866Joined: 01/03/2017
Setting up a trust would probably be a good reason to pay somebody well-versed in them to sit down and go over it with you.
It would be a good up front investment in order to avoid a back end headache.
“But investing isn’t about beating others at their game. It’s about controlling yourself at your own game.”
― Benjamin Graham, The Intelligent InvestorFebruary 13, 2019 at 6:15 pm MST #190604