12 Key Factors for Blended Families in IRAs, Qualified Retirement Plans

It is a fairly common practice for clients in blended families to divide their estates so their spouse and biological children never exercise ownership of their estate at the same time. Planners with clients seeking to avoid such shared interests may need to address the distribution of qualified retirement accounts and IRAs. Planners should take certain steps when dealing with these plans:

1. Find a copy of the plan document to determine what actions are permitted or restricted;
2. Determine the plan beneficiaries;
3. Ask about the client’s objectives;
4. Procure the client’s current income and cash flow needs;
5. Obtain information regarding the client’s family situation, especially concerning children from prior relationships;
6. Acquire the ages of the client, beneficiaries, and the spouse;
7. Evaluate any relevant estate taxes implications;
8. Asses access to capital needs;
9. Procure data on the liquidity of the estate;
10. Try to uncover any possible ethical conflicts;
11. Ascertain the client’s health status and family history of disease; and
12. Schedule future appointments based on when the client will need expert advice.

See Stephan R. Leimberg, L. Paul Hood, Jr., Jay Katz, Martin M. Shenkman, & Ed Morrow, 12 Key Factors for Blended Families in IRAs, Qualified Retirement Plans, Investment Advisor, August 24, 2017.

Special thanks to Jim Hillhouse (Professional Legal Marketing (PLM, Inc.)) for bringing this article to my attention.