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 […]
Tax Treatment of Traditional IRA’s
The whole reason for opening a Traditional IRA instead of a simple savings account is the tax treatment of your contributions, earnings and withdrawals. This type of retirement plan was started in 1974 to give average workers a way of saving for retirement on a tax advantaged basis. Contributions to a Traditional IRA The contributions […]
Who Should Open a Traditional IRA
The Traditional IRA concept is one of the best tax advantaged ways to save for retirement. Everyone should consider opening an IRA, but you may not be eligible or it just may not be right for your personal financial situation. So, before we consider who should open a Traditional IRA, we first need to review […]
What is a Traditional IRA
The Traditional IRA was the original individual retirement plan which came into existence when the Employee Retirement Income Security Act of 1974 was passed by Congress. The intent of these plans was to allow a worker, who was not covered by a pension or 401k plan, to accumulate tax advantaged savings for eventual retirement. In […]
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 […]