Retirement Replay: IRA Mistakes that Will Cost You, Ep #133

<p>The beginning of a new year is a great time to review what you should and shouldn’t be doing. That’s why in this special retirement replay edition of the Retirement Made Easy podcast, we’re revisiting episode #110: <a href= "https://retirementmadeeasypodcast.com/the-great-8-ira-mistakes-that-will-cost-you-money-ep-110/" target="_blank" rel="noopener">The Great 8 IRA Mistakes that WILL Cost You Money</a>. This episode covers 8 things you should be mindful of as we dive into 2023:</p> <ol> <li>If you’re a non-working spouse, take advantage of the <strong><em>spousal IRA option</em></strong> that’s available to you (you and your spouse can each contribute up to $7,000 per year.</li> <li>Did you know that you don’t have to take <strong><em>required minimum distributions (RMDs)</em></strong> from Roth IRAs? If you don’t need the money, don’t take the withdrawal and pay unnecessary taxes!</li> <li>Don’t roll over an IRA or 401k that has company stock in it or you’ll have to <strong><em>pay capital gains on the stock</em></strong> (net unrealized appreciation). Talk to a financial advisor first!</li> <li>Make sure you <strong><em>designate a beneficiary</em></strong> on your IRAs, or your estate will move into probate court when you die (leading to an unnecessary for your family to endure).</li> <li><strong><em>Don’t list a trust as the beneficiary of an IRA</em></strong>. the receiver only has 10 years to empty it and pay taxes. Secondly, trusts are taxed at a high rate ($13,450 and higher is taxed at 37%). </li> <li>If you’re under 59 and ½, make sure you <strong><em>do Roth conversions properly</em></strong> so you’re not paying Uncle Sam a 10% early withdrawal penalty.</li> <li>Make sure you’re not contributing to a Roth IRA or traditional IRA if you’re <strong><em>above the income cap</em></strong>, or you’ll be paying a steep 6% penalty each year the excess remains in the account(s).</li> <li>Whenever possible, <strong><em>don’t do an indirect rollover</em></strong>. If the money from an IRA is sent to you and