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  • You may want to have her check with her benefits department to see if it can be rolled over or be deferred as a salary reduction contribution. Since you don't need the income, that would be the best place to put that money. In that case, there it will continue to grow tax deferred and there won't be any required distributions until she reaches 70.5.

    In the event it can't, then it is now all after tax, or non qualified money. How it is invested is entirely up to you. Since it is after tax money there are no required minimum distributions, so it can be invested in anything you want. If you're concerned about being taxed annually on the gains then you can look into a tax free muni fund or an annuity.

  • Login to rate this answer:   Answered on 2/3/2013
**All above answers are provided as general information only. No warranty is made regarding the fitness or accuracy of the information provided in this answer. You should seek advice from a licensed CPA, attorney or CERTIFIED FINANCIAL PLANNER™ as to your unique financial situation.