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- 1401(k) Beneficiary Rules Can Override Your Wishes for Kids▼Name Your Two Kids on a 401(k), and Federal Law Can Hand It to Your Spouse Anyway. Name the Same Two Kids on an IRA, and They Get Every Dollar
A widely shared personal finance explainer highlights a quirk in US retirement law: federal rules give spouses automatic rights to a deceased worker's 401(k), even when children are named as beneficiaries, while IRAs pass directly to whoever is designated. The piece urges savers to understand the difference before assuming their beneficiary forms will be honored.
- 2Simplified 401(k) Rollovers Carry a Hidden Early-Access Trap▼Two Companies Are Making 401(k) Rollovers Easier. At 57, Moving His Account to an IRA Can Erase a Penalty-Free Exit
Two companies are streamlining the process of rolling a 401(k) into an IRA, but the move can cost early retirees access to their money. Workers who leave a job at 55 or later can take penalty-free withdrawals from their 401(k) under the so-called Rule of 55, yet once funds move into an IRA, withdrawals before age 59½ generally trigger a 10% penalty. Financial commentators urge anyone planning to retire before 59½ to weigh that trade-off carefully.
- 3How to Build $4,850 a Month in Tax-Free Dividend Income●How to Build $4,850 a Month in Tax-Free Dividend Income Inside a Roth IRA
A personal finance breakdown from 24/7 Wall St. outlines a strategy for generating roughly $4,850 a month in dividend income within a Roth IRA, where withdrawals are tax-free. The approach relies on building a large dividend-paying portfolio and letting contributions grow untaxed. Such guides are popular with readers planning retirement income amid uncertainty over future tax policy and market returns.
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Personal finance personality Dave Ramsey issued a warning to Americans about their retirement savings, addressing 401(k) plans, IRAs, and Social Security. The advice comes as many households remain anxious about whether their retirement funds will be sufficient and how future Social Security benefits may change.
- 5Inheriting a $200,000 IRA at 62: the RMD rule that triggers a $2,000 IRS fine▼Inherit a Parent's $200,000 IRA at 62 and Take Nothing the First Year. If They Had Already Started RMDs, the IRS Wants One Every Year, and the Fine on the Missed One Is About $2,000
Heirs who inherit a parent's IRA that was already subject to required minimum distributions must take an RMD every year themselves, even if they skip the first year. Someone aged 62 inheriting a $200,000 IRA who takes nothing could face a penalty of roughly $2,000 for the missed withdrawal. Personal finance outlets are walking readers through the rules on inherited IRA deadlines and penalties.