OK, This is a very tough situation and i cannot find any information in the right path of helping me. Ok so my dad just passed of pancreatic cancer, and for some reason me and my mom are split beneficiaries. There?s a lump sum of 500,000 dollars to be split between us. My mom is 53 and should have been the full beneficiary. But some reason i was listed as one too. So anyways, here?s the dilemma, Our plan was for just my mom to get the lump sum and roll over the 401 K to her IRA account and she was going to invest into wells fargo at a fixed rate of 5% giving us 2,000+ a month to live off the interest for now. But since it?s split we can?t really do this as planned. I need to know if it?s possible for me to forfeit my assets and for her to get the whole 500,000K without being taxed? That?s the first question. Ok so if that?s not possible to do, we will each receive 250,000, But apparently I found out my options are #1. Receive 100 dollars a month for the rest of my life (which is nothing ? ) Or get the lump sum and half it reduced to 125,000. Please note that i work at steak n shake and make 7.40 an hour part time and my mom hasn?t worked for 20 years and it kinda overweight and has bad arthritis in her knees and can?t really work. My dad supported us as a family. So am i allowed to roll over my 250,000 as an investment and work off the interest or some how combine me and my moms earnings to half it grow and live off the interest? What?s the best method for this dilemma? My family is working with us and we are having multiple financial adviser meetings to find the best. We talked to one who seemed to risky and seemed like a gambler of investments. The other one, said she can set up an investment at a fixed rate of 5%? Is there anywhere else that offers a fixed rate higher than that? Hopefully a 7.25% fixed? So right now our goal is to set all this up so all this money can grow and live happily and have it last the rest of our lives. Also to make it grow, and what?s a method where we can kinda not get all of our money taken away due to penalties and taxes? So there?s much to think about in this situation. Our current bills and living expenses right now are about 1800 a month. How can we set this up to last, pay bills, not get taxed, make this money grow and have a healthy future? Any advice would definatly help contribute to this matter. THANK YOU LOVE YOU ALL!!! ^____^
Main key questions:
#1. Can i forfeit as beneficiary my 250,000 so my mom gets all 500,000 with no penalties or taxes taken out.
#2. If #1 Fails, Can i take my 250,000 and invest it or roll it over without taxation or penalties. ( Apparently Since i?m 21 i can?t touch an IRA account till i?m 59 without a huge penalty )
#3. By any means neccasary, I?m looking out for me and my moms well being to support us through the rest of our life. I know 500,000 sounds like a lot, But over years of time span, It?s not that much at all. I calculated it and it would last 11 years just living on that with no other income. Please also note that my mom is 53 and cannot get Social security, But i?m looking into if she can get disability since she?s overweight can?t get around, has terrible arthritis in her knees, hasn?t worked in 20+ years, so also that?s another question i?ve added to the mix. As you can see it?s a very difficult and delicate situation, So anyone please help with this scenario, Thank you By the way this is not INSURANCE DEATH BENEFITS. This is a 401k plan my dad had built up working for over the years.
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