- May 25, 2024
- Posted by: legaleseblogger
- Category: Related News
Speed-Dial AI Lawyer (470) 835 3425 FREE
FREE Legal Document translation
Try Free Now: Legalese tool without registration
## Mom as Beneficiary of Dad’s 401k
As the title suggests, Mom is named as the beneficiary of Dad’s 401k account. The situation requires a decision to be made on whether to transfer the funds to their existing IRA, choose a different IRA, or cash out the account. Given that Mom does not currently need the cash, the preferred option would be to keep the funds in an IRA to avoid unnecessary taxes.
## Choosing the Right IRA
There are various options available for Mom to consider when selecting the most suitable IRA for her needs. Among the potential choices are Empower, known for their flat annual rate of 0.89% with no hidden fees, as well as popular alternatives like Fidelity and Schwab. Each of these IRAs offers distinct advantages and features that may appeal to Mom based on her financial goals and preferences.
## How AI Legalese Decoder Can Help
The AI Legalese Decoder can assist in navigating the complex terminology and legal jargon often associated with financial decisions like choosing an IRA. By using advanced algorithms and machine learning capabilities, the AI Legalese Decoder can simplify the information provided by different IRA providers, making it easier for Mom to compare the options and make an informed decision. Additionally, the AI Legalese Decoder can analyze the tax implications and potential benefits of keeping the funds in an IRA, helping Mom maximize the value of Dad’s 401k inheritance.
Speed-Dial AI Lawyer (470) 835 3425 FREE
FREE Legal Document translation
Try Free Now: Legalese tool without registration
AI Legalise Decoder: Your Solution for Deciphering Legal Jargon
In today’s complex legal landscape, understanding legal documents and contracts can be a daunting task for the average person. The use of legal jargon and complex language can make it difficult to interpret the true meaning of a document, leading to potential misunderstandings and disputes. This is where AI Legalese Decoder can help.
AI Legalese Decoder is an innovative tool that uses artificial intelligence to analyze and decipher legal documents. By inputting a legal document into the AI Legalese Decoder, users can quickly and accurately translate the complex language into plain, easy-to-understand terms. This can help individuals better understand the rights and obligations outlined in a contract, ensuring that they are fully informed before signing any agreements.
Not only does AI Legalese Decoder help individuals understand legal documents, but it can also assist professionals, such as lawyers and paralegals, in quickly analyzing and reviewing contracts. By using AI Legalese Decoder, legal professionals can save valuable time and resources by automating the process of interpreting legal documents.
Overall, AI Legalese Decoder is a valuable tool for anyone who regularly deals with legal documents. By simplifying the language used in legal contracts, AI Legalese Decoder can help prevent misunderstandings and disputes, ultimately saving time and money for all parties involved. Whether you are a layperson or a legal professional, AI Legalese Decoder is the solution you need to navigate the complex world of legal jargon.
Speed-Dial AI Lawyer (470) 835 3425 FREE
FREE Legal Document translation
****** just grabbed a
Your mom should definitely leave Empower and transfer to Fidelity or Vanguard for lower cost investment options.
Surviving spouses have more choices than non- spouse beneficiaries.
Is your mom age 59-1/2 or older?
If so she can invoke the spousal rollover rule and assume ownership of the decedent’s 401k (via an IRA) as if it were her own account. She can then take distributions from the IRA without penalty.
If not she should strongly consider keeping the account as an Inherited IRA. Doing so will allow her to take distributions without penalty.
Empower has a lot of fees and not the best investment options. I’d get out.
The ira should be free, and will be at places like vanguard or fidelity. Once you have the account, how you invest the money determines the fees. Pick some highly managed crappy mutual funds and the fees will be high. Pick a top tier sp500 index ETF and the fees will be almost non-existent. Like 30 dollars per 100k low vs 2000 per 100k in an expensive mutual fund .
You may find these links helpful:
– [401(k) Fund Selection Guide](/r/personalfinance/wiki/401k_funds)
– [401(k) FAQs](/r/personalfinance/wiki/401k)
– [“How to handle $”](/r/personalfinance/wiki/commontopics)
*I am a bot, and this action was performed automatically. Please [contact the moderators of this subreddit](/message/compose/?to=/r/personalfinance) if you have any questions or concerns.*
Transfer it to an IRA at either Vanguard, Fidelity, or Schwab. They’re all highly reputable and offer a variety of funds without transaction fees.
I personally like Schwab due to their website UI, customer service, and checking account benefits (unlimited ATM fee reimbursements and free checks).
A lot of people recommend Vanguard because I believe their funds are a little bit more tax advantaged but that wouldn’t matter in a tax advantaged (retirement) account. Also, they’re hiring a BlackRock executive as their next CEO, which could change the direction of the company. I’ve also read that their website UI and customer service is a bit lacking compared to Fidelity & Schwab.
I’m not as familiar with Fidelity but I believe they’re basically between Vanguard & Schwab in terms of services offered. I recommend researching the differences between the three and determining what’s important to you/your mother. But you can’t go wrong with any one of them.
Invest in a target date fund and pick a year where she will most likely start withdrawing money (retirement age).
[deleted]
Schwab … assuming there is enough has zero fees and uses her preferences for risk and standard portfolio theory (Intelligent Portfolio product)
just do fidelity is has the best interface and app out of the big three (vanguard, schwab, fidelity) and also has the most functions as well (fractional buying, after hours buying, etc.)
Do you have a Schwab or fidelity office near you, your mom might like that better
Rollover into an inherited ira or assume it
I would recommend fidelity. both he trio of fidelity vanguard and schwab seems to be fine.
I personally prefer fidelity over schwab and have not tried vanguard.
make sure when you rollover the 401k to IRa it remains the same contribution type (Tradional vs Roth) so you dont end up having to pay taxes here and now
Set up an appointment and pay for a financial advisor. They will have quite a few suggestions that fit with your needs.
She should immediately transfer it to their IRA (has the most favorable tax treatment). Then at her leisure, over the next two years or so, transfer that IRA to Fidelity or Vanguard, and invest it, within the IRA, in a target date fund for 2020.
Empower is absolutely the worst. I had a small amount in a former company’s 401k that got bought. They are literally there to bilk you until you get your stuff in order and transfer to a decent IRA provider.
I have an IRA with Empower that was a Great West 401(k) rollover from a former employer. The returns have been excellent.
Dump Empower. It is owned by a life insurance company. I am an anti life insurance company person for any type of retirement investment. It is good to own a life insurance company as a stock investment because they stick the fees to their customers, have large cash flow, and pay nice dividends.
Rollover IRA.
Fidelity, Vanguard, or Schwab. Their IRA fees will be less than 0.5%. Probably more like 0.25%.
You do not need to use their investment services. You just say no when they prompt you, that you will manage it yourself.
Since she does not need the money, she can put it into the S&P 500 Index Fund, setup distributions when she wants. Depending on her age at age 73 or 75 she WILL have to take RMD required minimum distributions.
I am retired. I collect social security. I am 100% in US Equities in my retirement accounts. Since she does not need the money, she can handle risk. The S&P 500 Index has returned over 10% annually since 1988.