Rollover IRA

Establish an IRA Rollover

This brings us to the last option. And for many people, it’s the best one. It’s called an IRA rollover.

In this option, you simply instruct your employer to roll over your qualified retirement plan assets directly to an IRA.

IRAs and Your Estate

In addition to growing your money on a taxdeferred basis, estate planning flexibility is another reason why rolling assets into an IRA is a potentially better strategy than leaving your assets in your employer’s qualified retirement plan.

Many qualified retirement plans don’t allow you to designate trusts, charitable organizations, or other non-living entities as beneficiaries. (Your employer’s retirement plan may agree to roll the assets only to one IRA, but that IRA can be divided after the assets have been received in the IRA rollover.)

The idea is to keep your assets earning taxdeferred returns until it’s time to take your required minimum distribution.

Beneficiaries can also allow assets to grow on a tax-deferred basis, as long as they take required minimum distributions.