The IRA and 401k are both types of programs established with the intent of allowing long term tax advantaged savings for your retirement years. They have similarities in how they are taxed, but differences in availability, provisions, and requirements. What is an IRA plan and 401k Plan An IRA is an Individual Retirement Account that […]
When and How to Start IRA Withdrawals
Hopefully, when you went to open an IRA, you did so with the intention of using it for long term retirement needs. The IRA concept is ideally suited for retirement savings and any withdrawals prior to retirement will diminish your long term plans. However, even if you do use an IRA for retirement, emergencies do […]
Using a Roth IRA as Your Emergency Fund
Opening a Roth IRA account is recommended for just about anyone who fits within the rules and who can afford to make a contribution. You can put in up to $5,000 per year ($6,000 if over age 50) of after tax dollars, and when you retire, start withdrawing all of the money in the account […]
What is a Roth IRA Conversion and How does it Work?
Simply put… Roth IRA conversion is the process transferring of your money from a Traditional IRA or 401k plan into a Roth IRA. Rollovers into a Roth IRA from a Traditional IRA and 401k plans came to the forefront in 2010 due to a change in the tax law. Before 2010, the tax law stated […]
How to Open a Roth IRA
Opening a Roth IRA account is really pretty simple. The problem is that there are so many choices of where to put your account that it can be confusing. You should go through a 5 step process in opening any Roth IRA account: Determine that you are eligible to open a Roth IRA Decide whether […]
Choosing the Right Investment for Roth or Traditional IRA
Selecting investments for an IRA, either for a Roth IRA or Traditional IRA, can be intimidating to many people. There are so many advertisements that bombard you on the TV and in magazines touting that their approach is the best. Also, you may be inclined to think that you first choose where to open your […]
Prohibited Transactions in an IRA
Some people can get pretty creative when it comes to taking tax deductions for all types luxury purchases or in making investments. A person might buy a boat and then try to deduct the purchase price from his taxes on the basis that he held a lot of business meetings on the boat — therefore, […]
How to Roll Over a 401k into an IRA?
How to Roll Over a 401k into an IRA? If you’re covered under a 401k plan at work, odds are you will do a 401k Rollover sometime during your working career. Why? Most people change jobs at least once during their working years. A lot people change jobs a number of times. Once you change […]
Roth IRA Withdrawal Rules
The Roth IRA is one of the best ways I know of to save for your retirement. You really can’t beat the tax free status of withdrawals at a time when your salary has stopped. Contributions to Roth IRA’s should be left in there at all possible costs so that you have the maximum available […]
Roth IRA Eligibility
It would be great to tell you that eligibility rules for a Roth IRA are easy, and you simply can or can’t open an IRA. But the IRS is involved here since it is tax law that governs Roths. And that always means the rules are complicated and have a lot of exceptions. One rule […]