IRAs

Q&A: How to protect QCD checks from mail theft

October 5, 2026 By Liz Weston

Dear Liz: In response to a reader whose check to the IRS was stolen from the post office, you (again) warned readers that mail theft and check fraud have soared and that electronic payments are now the safest way to send money.

I’ve been making my charitable donations using qualified charitable distributions from my IRA. My brokerage does this by mailing me a check in the amount I request, payable to my charity. I then mail the check to the charity.

It seems risky, but it is the only way I can use the QCD option to donate untaxed dollars. Is there a safer way to do this?

Answer: You’ve touched on an unfortunate reality. People are being warned not to mail checks because of rampant theft, yet brokerages still rely on sending physical checks for certain transactions such as qualified charitable distributions or 401(k) rollovers.

Since you can’t eliminate the risk with electronic transfers, see if you can eliminate at least one trip through the mail. Ask if the brokerage will mail the check directly to the charity, rather than sending it to you first. If that’s not an option and the charity is local, you could hand-deliver the check.

Another possibility is to find out if your IRA offers check-writing privileges. If it does, you could write the check directly to the charity. Use indelible black gel ink, which is harder to remove than regular ballpoint ink, and consider sending the check by certified mail so you can track its delivery.

You also should closely monitor your account to make sure the check gets cashed. IRA checkwriting agreements can require customers to report missing or fraudulent checks promptly. Waiting too long could jeopardize your ability to recover a loss.

As you know, qualified charitable distributions allow people 70½ and older to transfer money directly from an IRA to an eligible charity without including the distribution in taxable income. To count for that tax year, though, an IRA check must clear by year-end. Make sure the check is sent before December to leave plenty of time for the charity to receive and deposit it.

Q&A: Should I consider Roth conversions now or after I retire?

June 16, 2026 By Liz Weston

Dear Liz: My husband and I both waited until age 70 to start Social Security. I will be 72 in September and am considering retirement. My husband is retired, 74, and taking required minimum distributions (RMDs). We have always tried to maximize contributions to our pre-tax retirement accounts and are now realizing the downside as we pay taxes on those mandatory withdrawals. Should I consider Roth conversions now or after I retire? I realize I will need to pay taxes on those conversions, but would it be best to do that when my income is lower? I am thinking about my kids and their future.

Answer: Late-in-life Roth conversions can be tricky. The amount you convert is removed from RMD calculations, lowering future tax bills. But the conversion is added to your current taxable income, potentially making more of your Social Security taxable and temporarily raising your Medicare premiums (thanks to income-related monthly adjustment amounts or IRMAA) in addition to generating a big tax bill.

Theoretically, a conversion could still make sense if your current tax rate is lower than the one you’ll have once you start required minimum distributions at 73. The case for conversion is strengthened if you want to pass this money to your kids. They likely would have to empty any inherited retirement account within 10 years, and they could be in their peak earning (and tax-paying) years when they do so. By converting now, you would in effect be paying the tax bill for them, perhaps at a lower rate than they might face, and allowing them to inherit the money tax-free.

A tax pro can help you with the calculations so you’ll understand the financial impact of a conversion. Then you can make an informed decision about whether to proceed.

Q&A: Is it wise to have all your accounts under one roof?

June 3, 2024 By Liz Weston

Dear Liz: I’m setting up accounts post-divorce, while learning personal finance on the fly. Is it “safe” or advisable to have all of my larger accounts — IRAs, 401(k), cash management — with the same institution, or should I spread them around? I have smaller checking and savings accounts with a good credit union.

Answer: Using a single investment firm is certainly convenient, and most people will be just fine having all their accounts in one place.

The Securities Investor Protection Corp. covers accounts up to $500,000, including up to $250,000 in cash. This insurance protects you if the brokerage fails and your cash or securities go missing.

Customers with multiple accounts often get more coverage. For example, IRAs and Roth IRAs would each get up to $500,000 in coverage, as do individual and joint brokerage accounts. A person with all four types of accounts would have $2 million in coverage. Accounts for corporations, trusts, estate executors and guardians of minors also get separate coverage. For more details, see SIPC’s brochure, “How SIPC Protects You.”

Your 401(k) has its own protections. Assets in 401(k)s are placed into trust accounts, separate from the investment firms that administer the plans and the employers that sponsor them. The money can’t be touched by creditors of either one.

Thursday’s need-to-know money news

September 4, 2014 By Liz Weston

Today’s top story: Be on the lookout for deceptive balance transfer options. Also in the news: How to retire without a large nest egg, how to work less as you approach retirement, and how to raise a financially savvy teenager.

Credit Card Companies Warned of Deceptive Balance Transfer Offers
If it looks too good to be true, it probably is.

3 Effective Ways to Retire Without a Large Nest Egg
Eliminating your debt is key.

How to Work Less as You Approach Retirement
Time to start using those sick days.

When Bad Things Happen To Good People With IRAs
Understanding beneficiary designations.

How Financially Savvy Is Your Teenager?
The earlier they learn, the better off they’ll be.

How to start investing

April 10, 2014 By Liz Weston

A reader recently posted this question on my Facebook page:

Liz, I’m 30 years old and looking into starting [to invest in] mutual funds and IRAs and have no idea where to start. I know I really need to invest for the future and am eager to do so, but again, have no knowledge on any of this nor know where to start. Any advice or pointers would be more than appreciated.

I suggested he start with reading two really good books for beginning investors, Kathy Kristof’s “Investing 101” and Eric Tyson’s “Personal Finance for Dummies.” But here’s a summary of what you’ll learn:

Get started investing as soon as possible, even if you don’t quite know what you’re doing. You’ll learn along the way, and you really can’t make up for lost time.

Invest mostly in stocks. Stocks over time offer the best return of any investment class, and provide you the inflation-beating gains you’ll need for a comfortable retirement.

Don’t try to beat the market. Few do consistently. Most people just waste a lot of money. Instead, opt for mutual funds or exchange traded funds that try to match the market, rather than beat it.

Keep fees low, low, low. Wall Street loves to slather them on, but fees kill returns. Here’s an example: An annual IRA contribution of $5,000 can grow to about $1 million over 40 years if you net a 7 percent average annual return. If you net 6 percent, that lowers your total by a $224,000. That’s a heck of a lot to pay for a 1 percentage point difference in fees.

If you have a workplace retirement plan such as a 401(k), that’s where you should start investing. If you don’t, then an IRA you open yourself is the next best thing.

So here’s a prescription for getting started: Open an IRA at Vanguard, which prides itself on its low expenses. Send them a check for $1,000 (the minimum to get started with an IRA). Choose a target date retirement fund that’s close to the year when you expect to retire (in this reader’s case, that would be the Vanguard Target Retirement 2050). Target date funds take care of everything: asset allocation, investment choices, rebalancing over time for a more conservative mix as you approach retirement age. You can get the $20 annual account fee waived if you sign up for online access and opt for electronic delivery of account documents.

There you go–you’re on your way.