Can a retiree cash out all assets acquired over a lifetime, such as stocks, annuities, IRA', cd's, investments, etc., put it into one bank?

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Can a retiree cash out all assets acquired over a lifetime, such as stocks, annuities, IRA', cd's, investments, etc., put it into one bank?

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mom, aged 79 wants to consolidate ALL monies into one accessible account, most of which are investments that are fully matured. She is retired, no longer wants to INVEST the money, and just wants it safe. Financial advisor wants to move to one bank but wants to invest it similarly. She does not want investments, does not want to worry about the money anymore, wants it safe, and preferably in child's name vs her own. it is too stressful (approx 600,000 total). Child already on regular bank's savings/checking account, and is handling her finances daily with her instruction. She is not senile or nor does she have dementia. Child is power of attorney with full power and is doing all mom asks. If she wants all accounts in child's name, is that advisable? Child is beneficiary as well. If she wants a single account with all these extra funds, will a bank allow her to do this and will it be FDIC insured once transferred?

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approx 600,000 total) is way too much money to do this with at one time even if it were spread across 3 banks.

First, it will create an unreal tax burden to cash all of these in at one time.

Second, if she places this money in her child's name, she will create a huge gift taxing bill for herself.

Third, she has no idea how long she will live and thus may need some or all of that money for her own care. At anytime, something could happen to her health which would put her in a nursing home which could easily eat up that money in 6 years and leave her in need of Medicaid.

If she ends up having to go into a nursing home and needing Medicaid, they will look back 5 years into her finances. If they find that she's given tons of money away, she want qualify for a while.

In my own experience with my mother's investments, she made me co-owner with right of survivorship. There was no way it could be written up POD to me as her child.

Is she a member of a bank that is a credit union? I ask that because my mom's and my account in the state credit union has much better rates than the standard banks do. I would think that it might be wiser to slowly liquidate into 3 separate banks over time instead of doing it all at once in three banks or all at once in one bank.

I think she needs a second opinion on her financial advice.

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It wouldn't be advisable to put it all in one account, since the FDIC limit is $250K. However, she can put it all in one bank in different accounts. Savings accounts right now pay next to nothing in interest, so there is loss to inflation each year. Still the money is safe. The child is POA so can conduct business and the accounts can be written as Payable on Death to the child to avoid probate. This gets around any potential problems of having the child's name on the account as an owner.

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BTW, since Mom is only 79, have you considered an annuity? I don't know if they can be written as POD to the child, but you could inquire. Some annuities are expensive to administer, but it could be worth looking around.

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It really depends on if all the money is after-tax money. I didn't see any reference to ordinary IRA's. The financial manager may recognize that all the money in the accounts are after-tax, so will not be subject to additional tax by changing the type of account. My reservation would be if the money was changed from the parent's name to the child's name. That could create a tax burden that would lose a good bit of money. The money could be inherited without the burden unless it was part of a larger estate. The sweep accounts sound fine to me if all the money is after tax. The change in ownership of the money, however, does cause concern about tax liability.

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Oops, I am sorry. I missed the IRA's. If they are standard IRAs, they will be taxed when cashed out. They could be rolled over to the bank without taxing them. The mother may not mind paying taxes on them to get things consolidated. That, of course, is her call. They would have to be taxed at some time if they are standard IRAs. It is just that most people try to keep the distributions down to keep the taxes lower.

The mother's situation reminds me a bit of mine. She and my father ended up with bits of money in several places. There are many CDs, IRAs, pension plans, stock, and regular accounts. I worked with her to cash out many of the smaller CDs just to help consolidate things. It is so messy that I wish we could consolidate everything. I decided to let the executor, my brother, deal with the mess when it comes time.

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Is this what you are talking about?
wellsfargo/investing/cash-sweep/

And, I assume that you are the son who moved in? What's your relationship like with her daughter?

This now sounds more complicated with more than one child involved.

Does your mom have a Will? How does your mother want her money divided up between the son and the daughter, etc.?

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It's nice of you to be gathering information. Did someone ask you to do this? I thought you were a family member to have such intimate knowledge about everything. I'm not sure that I understand your role in all of this with her having a financial adviser and the son being the POA. I hope all of this works out well.

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I would think he's suggesting a sweep because she wants all of her $600,000 + of investments of various types all cashed in and placed into one regular account that is FDIC protected unlike investments. With her being over 70, she's going to have to cash in a certain amount of her IRAs each year.

Whenever, you cash that creates a tax burden. It's not like moving money from a checking or a savings account into one new account.

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I am a long time friend of family. She has a Trust and a Will, all that is current and fine. She just wants her money consolidated, and many people are doing that. She has invested her whole life, and wants people to stop telling her rates, etc. because she is done with investing. 10 accounts are just spread out too much. She wants her local bank. Fidelity the cash management acct that works just like a regular checking account. Does anyone know if the Wells Fargo Sweep is the same? It insures up tp $750,000 in the sweep "hold" but then talks about investing. Do you have to invest or can it stay in the hold account? It doesn't seem as easy to access as Fidelity. Fidelity-.FDIC insurance
Coverage up to $1,250,000—five times more than the typical bank. Free checking, free bill pay, free ATM fees reimbursed. Thats what she wants, only at a Bank. Does anyone know anything about the WellsFargo one? Thank you so much for the help.Oh, and she has spent enough on Lawyers in the past two so she doesn't want to "hire" someone else who is in a profession just to take more of her money. She knows the financial advisor somewhat, but then there was Madoff and look what he did to his pals.

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JessieBelle, thank you for your replies. She already has two annuities. They have given her great return. However, she is done investing and those accounts are not insured by the FDIC. Thats why she is so concerned. And cmagnum, thank you very much as well. However, in ref. to your comment the total "being way too much money to do this with at one time even if it were spread across 3 banks. First, it will create an unreal tax burden to cash all of these in at one time." Why would a Financial advisor suggest this sweep if that were the case? The advisor has been checked out and is in excellent standing with the State Board. I would hope he wouldn't put her, or anyone, at a terrible risk with her taxes!

Can a retiree cash out all assets acquired over a lifetime, such as stocks, annuities, IRA', cd's, investments, etc., put it into one bank?

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