How Do You Open a Trusteed IRA?


Quick Answer

Open a trusteed IRA by finding a trustee that offers IRA services, notes Marcum Financial Services. Compare the services offered by several companies to find the best fit. The individual opening the trusteed IRA names a beneficiary. Complete the beneficiary designation form and trust agreement with the help of an attorney and the trustee.

Continue Reading
Related Videos

Full Answer

Trusteed IRAs typically have higher minimum balance requirements and fees. It is advisable to open a trusteed IRA only if it has a total value of at least $2 million. The client may need the money in a lower valued IRA during his or his spouse's lifetime, according to the Wall Street Journal.

Regular IRAs pass on to a beneficiary if the client passes away. The beneficiary may withdraw and spend all the money in one go. In contrast, a trusteed IRA continues to accumulate after death, states Marcum Financial Services. By selecting a young IRA beneficiary, the client can arrange for smaller distributions from the IRA every year after death.

The client can choose to keep restrictions on the distributions until his beneficiary reaches a certain age, notes Marcum Financial Services. This ensures the beneficiary only gets the majority of the assets in a trusteed IRA when he is mature enough to handle the money.

Learn more about Financial Planning

Related Questions