Where to put small inherited ira?

[Chet]

I recently inherited a relatively small amount in an ira ($5000) and need some suggestions on where to park it. It's currently in a MM account through Ameriprise which is earning some paltry amount not worth mentioning. They are also killing me with a yearly fee of $40.

Should I just withdraw it and put it in my ROTH (TRprice TRRKX) or transfer it to a TRP mutual fund? Any other suggestions would be great

[disneysteve]

We need to know a few things in order to answer your question.

From whom did you inherit the IRA? The rules are different if it came from your spouse or from someone else.

When did you inherit the IRA?

Were you the sole beneficiary or were there multiple beneficiaries?

How old was the decedent and had he/she started taking distributions from the IRA yet?

[Chet]

We need to know a few things in order to answer your question.

From whom did you inherit the IRA? The rules are different if it came from your spouse or from someone else.

When did you inherit the IRA?

Were you the sole beneficiary or were there multiple beneficiaries?

How old was the decedent and had he/she started taking distributions from the IRA yet?

It was inherited from my Grandfather in Aug 2008. I was one of four beneficiaries. He was 82 when he passed and was taking distributions.

In case my age is relevant, I am 28.

[disneysteve]

You -- not IRS -- should benefit from an inherited IRA

Here is a good article that walks you through your options. Scroll down page 1 to the section titled "Non-spousal inheritances". Basically, you have 3 choices. You can 1) roll it into a benficiary IRA, 2) cash it out so it is no longer an IRA or 3) give it away.

The deadline for doing some of this stuff is December 31 of the year after the account owner died, so you need to decide soon what you want to do since you have less than 2 months to set things up.

[Chet]

You -- not IRS -- should benefit from an inherited IRA[/url]

Here is a good article that walks you through your options. Scroll down page 1 to the section titled "Non-spousal inheritances". Basically, you have 3 choices. You can 1) roll it into a benficiary IRA, 2) cash it out so it is no longer an IRA or 3) give it away.

The deadline for doing some of this stuff is December 31 of the year after the account owner died, so you need to decide soon what you want to do since you have less than 2 months to set things up.

Good read, thanks Steve.

[LuxLiving]

Thanks for the link DS, beneficial reading for someone who's unfortunately likely to inherit a couple! I'd rather have Hubster around.

[Hot dog]

I am thinking you could roll it over into an ira for yourself and then next year roll it over into a roth. I think if you do it that way you can still contribute your own 5000 into the roth. I am not sure if that is correct though.