Sage-Tips

Is Northwestern Mutual Good for IRA?

Northwestern Mutual has a network of more than 6,400 finance professionals nationwide who advise clients on not only IRAs, but also life insurance, college savings, wealth management, estate planning and more. That makes the company a good choice for those seeking comprehensive financial services in one place.

Does it matter where you get an IRA?

You can open an IRA through almost any large financial institution, including banks, mutual fund companies and brokerage firms. The major difference between most institutions is the fee structure.

Why you shouldn’t do a Roth IRA?

One key disadvantage: Roth IRA contributions are made with after-tax money, meaning there’s no tax deduction in the year of the contribution. Another drawback is that withdrawals of account earnings must not be made before at least five years have passed since the first contribution.

Should a Roth IRA be placed in a trust?

Pouring your Roth assets into a trust after your death can be a good idea—as long as you’ve chosen the right type of trust and your beneficiaries are specifically named in the trust. The trust must be a conduit trust that will take out the required minimum distributions (RMDs) each year.

Do beneficiaries pay taxes on inherited Roth IRAs?

Inheriting a Roth IRA as a Non-Spouse Earnings are taxable unless the 5-year rule is met. You won’t be subject to the 10\% early withdrawal penalty. Assets in the account can continue to grow tax-free. You can designate your own beneficiary.

What happens when a trust inherits a Roth IRA?

When you pass your Roth IRA through a living trust, your beneficiaries will receive the Roth assets tax-free. Doing this also allows you to “stretch your IRA.” With a Roth IRA, you can leave the money in the account, as there are no required distributions until after the death of the owner.

What types of Iras does Northwestern Mutual offer?

Northwestern Mutual offers both traditional and Roth IRAs. Contributions to Traditional IRAs are tax deductible. The investor pays taxes on their withdrawals from a Traditional IRA in retirement.

Does Northwestern Mutual give tax advice?

The Northwestern website specifically warns that “Northwestern Mutual does not give legal or tax advice”. Brokers can explain the pros and cons of traditional versus Roth IRAs, but should not be expected to advise a client on which to choose.

How do I open a new account with Northwestern Mutual?

To open a new account, investors will need to contact their Northwestern Mutual adviser or contact their local Northwestern Mutual office to find an adviser. Potential clients can also fill out a form on the Northwestern Mutual website to have an adviser contact them.

When does a Roth conversion make sense for You?

If you have money in a traditional IRA, there are several instances when it might make sense to consider a Roth conversion. That’s because a Roth conversion allows you to pay tax today, locking in what you owe Uncle Sam while avoiding any subsequent taxes on that money now and in the future.