By J.P. Dahdah, Founder & CEO of Vantage
Staying proactive and helping relatives setup a retirement account can be beneficial to helping them build and save for their eventual retirement. Many times family members will try to find creative ways to encourage their relatives to save for older age and retirement, but creating an IRA or Self-Directed IRA account for them is not one of them.
1. Acquiring a Self-Directed IRA account. You may want to help your kids or family members out by establishing a retirement account for them. Unfortunately, for both of you, this is simply not allowed. Self-Directed IRAs must be setup by the individual who plans on contributing to the account and can only be utilized by this same person. But while you may not be able to physically give an IRA away, if needed you could make a family member a beneficiary of the account in the event that something happens to you.
2. Gifting funds from a Self-Directed IRA account. If you were seeking to gift funds to a charity from an IRA account, you may want to consult with your administrator to see if this option is available. Depending on the regulations you may be able to gift funds tax free. It is important to remember that if you do gift this money, it can affect your lifetime gift exemption amount.
Consulting with your account administrator can help to ensure you don’t cause any adverse effects by withdrawing needed funds.
For more information on how you can discover your IRA investing alternatives, contact our team at (866) 459-4590 or ClientService@VantageIRAs.com.