Hi. It took me about a month to post after some mourning, but I think it's time.
My father, an only parent, left me 90k by way of his retirement IRA, which I am beneficiary of, when he died Jan 23rd. I see no reference to it being a Roth IRA, and I don't really understand how the money will affect my discretionary income.
I graduated college recently, unemployed and 50k in debt, so am only just recently faced with the all-government, no-private loans, at a $0 payment requirement under IBR. I'm not rushing into work because I am a game developer leading a non-monetizable portfolio project with more than a dozen people involved, set to release late this year. Therefore, 2017 income is a factor, but not a major one. (I network well, and there are some jobs that I would apply for, but I am not actively seeking them out.)
Additionally, I am not taking the IBR money all at once (as that has serious early dispersement penalties of, I'm told, 30%. The minimum I am forced to take is only 3k, but given the risk I am taking putting off paid work, I am leaning towards taking more, if it wouldn't throw me into a new tax bracket or slam me with penalties.
As an IBR borrower, I have been told I can single out specific loans to pay off, rather than taking a chip off the whole. Is this true? They are all government loans and one is significantly higher than the others (6.8%).
I've gotten mixed advice on whether I should knock that 6.8% monkey off my back, or stretch things out as long as possible.
The main questions I have.
Despite running on fumes while my project is completed, should I take some to kill the 6.8% loan?
Can I actually target that specific 6.8% loan, as I've heard, and if I do will I still be paying the usual percentage of my discretionary income towards the whole, despite paying so much this year in one rocket full of cash?
I'm told the IRA is considered taxable income, but it's also an inherited one. I alternatively hear that the IRA is "considered income" and that inheritance is "not taxable". Anyone with a similar situation have any insight as to that?
There is also the option of just rolling it into my own retirement fund and letting the money ride. I don't think I can afford to do that, but I have read that an inherited IRA can be majorly beneficial, regarding taxes, if I can get by in life without touching it.
Any advice form people who have had IBR loans when inheriting an IRA is welcome. I will of course ask these questions of my loan provider, a lawyer, etc., but I felt Reddit would be a good place for orientation before I start dealing with all of this.
Thanks in advance...
I miss my dad and even thinking about this feels weird.
Submitted February 24, 2017 at 05:43PM by hombregato http://ift.tt/2l93leP
