Bull markets tend to make people lazy. I’m often surprised by how little attention some people give to their retirement accounts. They don’t look at statements. They don’t remember who their beneficiaries are. Sometimes they can’t even tell me if their company pays a match on their 401(k) plan. I know how busy life can get, but a “set it and forget it” approach to retirement savings is rarely a recipe for success.

If this sounds like you, please consider working with an advisor who can help you make sure your retirement accounts are working for you. According to a Vanguard white paper, expert advice can boost your returns by up to 3%. A separate study conducted by Russell Investments reached a similar conclusion. Whether you work with an advisor or not, you’ll benefit by reviewing your retirement accounts on a regular basis. Here are three questions you might want to ask as part of that review.

Q Are my beneficiary designations up to date?

A Life happens and sometimes your IRA beneficiary designations can get out of date without you even realizing it. Has there been a divorce or a death in the family? Have you had a baby? Any of these could mean you need to update your beneficiary designation. Mistakes with beneficiary designations cause more trouble than just about any other aspect of financial planning.

A woman came to me a couple of years ago with a serious problem. Her husband of 35 years had died unexpectedly. As she worked with her attorney to settle his estate, she discovered that her husband’s IRA, worth more than $1 million, listed their three adult daughters as the primary beneficiaries. Even though his will and their trust documents indicated the IRA was to go to the wife, she was out of luck. The beneficiary designation was the controlling document. I suspect there may have been more to the story than she told me, but the lesson was clear: it pays to regularly review the beneficiary designation on each of your retirement accounts.Q Should I name my trust as my IRA beneficiary?

A Naming your revocable trust as the designated beneficiary for an IRA is tricky. Jeffrey Levine, a nationally recognized IRA expert, once told me that 85%-90% of the time he sees a trust designated as the beneficiary of an IRA, the designation fails to accomplish its intended purpose. Unfortunately, those who end up getting hurt are the people the IRA creator most wanted to help. If you have a trust as the designated beneficiary of your IRA, it pays to get it reviewed by a fresh set of expert eyes.

Q Have I made any investments in my IRA that might give rise to a prohibited transaction?

A This is an especially tricky area for people with self-directed IRAs. Some transactions that seem innocuous on the surface can have grave consequences in an IRA. For example, let’s suppose you buy a piece of rental property in a self-directed IRA. If you do any work on the property or allow a family member to do any work on it, you’ve engaged in a prohibited transaction. If you allow your son to live in it — even if he pays full market rent — you have engaged in a prohibited transaction.

Prohibited transactions are serious and can result in your IRA losing its tax-deferred status. If this happens, the IRS will require you to pay taxes plus penalties on the entire value of your IRA. If your review uncovers potential prohibited transaction problems, talk with your financial advisor to determine your best course of action. You may want to divest yourself of the asset. At a minimum, you’ll want to move all non-tainted assets to a new, separate IRA.

This commentary is provided for general information purposes only, should not be construed as investment, tax or legal advice, and does not constitute an attorney/client relationship. Past performance of any market results is no assurance of future performance. The information contained herein has been obtained from sources deemed reliable but is not guaranteed.

Steven C. Merrell is a managing director at Creative Planning in Monterey (formerly known as Monterey Private Wealth). He welcomes questions you may have concerning investments, taxes, retirement or estate planning. Send your questions to: Steve Merrell, 2340 Garden Road, Suite 202, Monterey, CA, 93940. Or you can email steve.merrell@creativeplanning.org.