It’s a Stretch – HumbleDollar

FROM LISTENING to financial talk radio shows, it seems the hot topic these days is the SECURE Act and how it’s hurt the middle class. One caller had $2 million in his IRA, and was worried about the impact of the stretch IRA’s elimination on his children and grandchildren.

What am I missing here? I thought IRAs were a vehicle to help average Americans save for their retirement, not an estate-planning tool.

Under the new law, surviving spouses aren’t adversely affected, so that’s not the problem. Instead, the SECURE Act affects those who want to pass along their IRA’s tax advantages to their children and grandchildren. Got so much money in your retirement accounts that you don’t believe you’ll spend much of it? Yes, the new law is aimed at you—but, no, you aren’t truly middle class.

If you want to leave a nice sum to your children and grandchildren, you should be using life insurance or holding investments outside of retirement accounts, not funding an IRA.


Source: It’s a Stretch – HumbleDollar

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