The following is an excerpt from this month's topic.

MAXIMIZING RETIREMENT AND
ESTATE PLANNING

Your retirement plan, be it company pension, 401(k) or IRA is likely one of your largest assets. Coordinating retirement and estate planning can be difficult due to conflicting income and estate tax regulations. Handled correctly, the retirement plan supports not only your retirement, but also supports your heirs after your death. Handled incorrectly, the plan may support you during your lifetime, but be almost entirely devoured by taxes at your death.

Congress allows tax deferral to support the owner in retirement, not to build assets for heirs. Minimum distribution rules govern how quick (beginning at age 70 1/2) money must be paid from a plan. Different distribution calculation methods are sanctioned.

Usually, the owner elects to withdraw funds on a joint (owner/beneficiary) life expectancy method. Under most IRAs and retirement plans, the "recalculation method" is applied unless another is specifically elected.

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