Nor was there much thought given to the needs of heirs in the next generation. Your beneficiary form is especially important if you plan to leave your IRA to anyone other than your spouse. Misplaced forms can create havoc. The wave of mergers among financial institutions has increased the chances that your IRA forms will be misfiled in some storage warehouse just when your heirs need them. Be wary of free advice.
Many people turn to a bank officer, fund company phone rep, or broker for counsel.
These professionals usually are not qualified to handle complicated estate and taxation matters. George Stone, a retired New York City school principal, called his four fund companies, Fidelity, Vanguard, Franklin Templeton, and Oakmark, to ask about rules for structuring an IRA to leave to his wife and, ultimately, his children. Instead, consult an estate lawyer or a CPA with a special interest in tax matters. Unless your situation is truly unusual, you shouldn't have to buy more than a few hours of a pro's time to get your IRA targeted properly at your heirs. Stone, for example, ended up hiring a lawyer with IRA expertise who structured his account and created customized beneficiary forms.