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A Quick Look At Stretch IRA Guidelines

Posted on | March 21, 2011 | 4 Comments

The stretch IRA has been available for some time but a lot of people are not aware of it. The IRA was designed to provide tax sheltered investment money for retirement. The stretch IRA guidelines goes further by making the money not only available for one person but for generations to come. In the stretch, the age of the owner and the beneficiary of the IRA account are used to calculate the minimum distribution amount. This makes more tax deferred money available in the account.
In the stretch IRA guidelines, the younger the beneficiary, the better for the account. Therefore if you are married with kids, it is better to put the name of the youngest person in your household on the forms. A grandchild is a good idea. This will make more money available for the family in the event of your death. This is the way to properly stretch your tax advantages.
This is a good way to increase the wealth benefit you pass on to your heirs. If less money is taken out of the account, it will accrue interest and become substantial over the years to provide wealth for the family left behind. For example, an IRA account opened in your 20s with up to 200 dollars contribution every year at a 6 return rate could easily amount to a couple of million dollars of tax deferred money for your grandchild.
If you dont have an account yet you might be asking how to open an IRA. The process is quite simple. Seek come tent advice on the best type of investments. Look or people that have IRA accounts that are doing well. Check out a list of custodians and get familiar with the kind of service and investments that they provide. Take good care who you name as your beneficiary.


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