HONOLULU (HawaiiNewsNow) - It's an uncomfortable topic but what happens to IRAs when you die? It depends on how you set it up when you establish the account, naming your beneficiaries. Generally, there are 2 types of beneficiaries-primary and contingent beneficiaries. But it's important that you make sure you review those beneficiaries designations from time to time.
Assuming you designate someone to inherit you IRA, how will distributions be made to your beneficiaries? It all depends on the provider of your IRA. But generally speaking, there are 3 things that happen. Either it's paid as a lump sum to your beneficiary or it must be distributed within 5 years following your passing or taken over the life expectancy of your beneficiary.