Putting Your Estate in Order When is the last time you reviewed your estate plan? Do you have a will? According to a recent survey by the Harris Poll, 64% of Americans don’t have a will. Why? The most common reason mentioned was that “they hadn’t gotten around to it yet.” If you have a will, when is the last time you reviewed it? Due to estate law changes in the last seven years, there is a good possibility that a will that was drafted more than seven years ago needs to be revised. In addition, when is the last time you reviewed your beneficiary designations in your 401(k)s, IRAs, life insurance policies and annuities? One of the most common estate planning mistakes is not making sure that beneficiary designations are in order. Many people believe that the will governs everything about their estate and don’t think about regularly reviewing their various beneficiary designations. In fact, if your beneficiary designations differ from what is expressed your will, the beneficiary designations specified in retirement plans or insurance policies will trump the will. Another reason to review your estate plan is the passage of the SECURE Act in December 2019. It abolished the Stretch IRA for many beneficiaries. In the past, if a child or grandchild inherited an IRA, they were able to stretch out distributions from that IRA over their lifetime. The new law requires heirs who inherit an IRA to take all of the money out within a tenyear-period. This applies to both inherited traditional and Roth IRAs. That means an adult child who inherits an IRA when they are in their fifties and are at their peak earnings level are going to have to pay more taxes on their distributions than they would have before. Trusts that are named as beneficiaries to an IRA need to be reviewed to make sure that the trust complies with the new law. Many trusts will not. There are some exceptions to the tenyear rule: spouses, disabled children, children while they are minors (but not grandchildren), the chronically ill, etc. However, the elimination of the ability to
16 BOOM!
August 2020
RiverRegionBoom.com
Financial Thoughts with Susan Moore
a template of how to conduct a family meeting at which you communicate to your family and heirs your plans and intentions around the distribution of your assets. A vital part of this meeting is to define the roles and responsibilities of your various heirs as well as general instructions, including the location of key documents, burial wishes and intentions for tangible personal property. If you would like to be included in the webinar, please contact Sarah at 256.234.2761 or sarah@ moorewealthmanagement.com.
By Susan Clayton Moore, J.D.
Principal of Moore Wealth Management, Inc.
stretch out distributions over a lifetime will impact individuals who planned on leaving a large IRA to their children or grandchildren. Planning solutions that will be discussed during the webinar described below include changes like taking more or larger distributions from an IRA to fund the premiums on a life insurance policy so that the children can receive a tax-free legacy or using the IRA to fund annual charitable giving while leaving other assets to children. We will also discuss how the SECURE Act makes Roth IRA conversions more compelling. On Wednesday, August 26th, Susan Moore of Moore Wealth Management will be conducting a free estate planning webinar. The workshop covers several topics, including a review of the various legal documents involved in estate planning such as wills, durable powers of attorney, advanced healthcare directives, revocable and irrevocable trusts. Beneficiary designations are a great tool in estate planning, properly used. They are flexible and can be changed without having to re-do legal documents to reflect family changes such as births, deaths and divorces. The workshop covers how to use these beneficiary designations properly, including primary and contingent beneficiaries and per capita or per stirpes distributions. In addition, the workshop gives attendees
Susan Clayton Moore, J.D., is a financial advisor and wealth manager with Moore Wealth Management, Inc. which has offices in Montgomery, Alexander City and Auburn. She has been a financial planner for over 37 years. Susan has been quoted in Kiplinger’s Magazine and Investment News. She earned her law degree from Tulane University in 1981. Contact Susan at 256.234.2761 or by emailing her at susan@ moorewealthmanagement.com. We offer confidential consultations and second opinions about portfolios without cost or obligation. The opinions expressed in this commentary are those of the author and may not necessarily reflect those held by Kestra Investment Services, LLC or Kestra Advisory Services, LLC. This is for general information only and is not intended to provide specific investment advice or recommendations for any individual. It is suggested that you consult your financial professional, attorney, or tax advisor with regard to your individual situation. Comments concerning the past performance are not intended to be forward looking and should not be viewed as an indication of future results. Securities offered through Kestra Investment Services, LLC (Kestra IS), member FINRA/SIPC. Investment Advisory Services offered through Kestra Advisory Services, LLC (Kestra AS), an affiliate of Kestra IS. Kestra IS or Kestra AS are not affiliated with Moore Wealth Management, Inc.
The River Region’s 50+ Lifestage Magazine
