7 IRA mistakes to avoid
Messing up the details
There’s not a lot of paperwork with an IRA, but it's still your responsibility to see that it’s done right.
Certified financial planner Diane Pearson has seen family members lose benefits because the form designating a beneficiary for an IRA in the event of death was filled out improperly.
"Failure to properly check the details can come back to haunt you," Pearson says. "When in doubt, consult a professional, but don’t be afraid to check their work."
She has also seen transfers from other retirement accounts, known as rollovers, go wrong because the transfer was improperly handled by the receiving financial institution.
"We see these cases all the time. We find out the money never got to the IRA," she says, which can lead to penalties. "If it happens, the participant actually has to go to the IRS and ask for relief."
The lesson: Make sure all the blanks are filled and the boxes checked.