Are you planning to leave your IRA to your children? You might be handing them a tax nightmare instead of a gift. Find out why Clark says, "You only give a traditional IRA to heirs you don't like."

Here’s what we’re covering in today’s Clark Smart Investing newsletter:

Prior to 2020, passing wealth from generation to generation through an IRA was a straightforward strategy. A family could take a pot of money and grow it tax-free or tax-deferred, passing it down the family tree.

Now, it’s complicated.

The U.S. Senate passed the SECURE Act in December 2019. It includes a provision that prohibits stretching the distribution of an inherited IRA for an indefinite amount of time.

What did the rule change in terms of IRAs and inheritance? Are the rules different for a spouse? What are other, better vehicles to transfer wealth to your children or grandchildren? And what happened to the IRS grace period? Find out in the full article.

Every week, we'll ask a new question to get your take on the latest financial trends and topics.

Last Week’s Poll Results

We asked: “Have you ever borrowed from your 401(k)?” Here’s how you answered:

In this recurring Q&A, we share questions that have been answered by Clark Howard or Wes Moss on the podcast. Submit your question today!

Bert in Georgia: Do you think much of the continued growth of the S&P 500 is due to automatic 401(k) payroll investing from employees/employers? What could disrupt this momentum?

Wes Moss says: With 70 million Americans participating in 401(k) plans, the market enjoys a massive, automated tailwind driven by roughly $500 billion in annual retirement contributions. When accounting for all liquid savings, Americans funnel nearly $2 trillion into investments each year while withdrawing only $1 trillion, creating a consistent supply-and-demand advantage that naturally exerts upward pressure on stock prices. While this momentum could technically be disrupted by significant economic shocks, such as oil crises or shifting demographics, the "inertia of investing" acts as a powerful safeguard. Because the friction of changing contribution settings — like remembering passwords or navigating complex HR portals — prevents most people from stopping their "auto-save" habits, this consistent inflow of capital remains a structural pillar of the market that is incredibly difficult to break.

The Team Clark Consumer Action Center is a free helpline that can help you navigate your money questions. Call 636-492-5275. Visit clark.com/cac for more information.

This information is provided to you as a resource for informational purposes only and is not to be viewed as investment advice or recommendations. Investing involves risk, including the possible loss of principal. There is no guarantee offered that investment return, yield, or performance will be achieved. This information is being presented without consideration of the investment objectives, risk tolerance, or financial circumstances of any specific investor and might not be suitable for all investors. Any company names shown are for illustrative purposes only and are not a recommendation, offer to sell, or a solicitation of an offer to buy any security. The views and opinions expressed are for educational purposes only as of the date of production/writing and may change without notice at any time based on numerous factors, such as market or other conditions. Always consult your own legal, tax, or investment advisor before making any investment/tax/estate/financial planning considerations or decisions.