For as long as men have ruled other men, taxes have been a necessary way of life. They fund the government and provide the civil services that we depend on in our everyday lives. But as important of a notion as that is, no one likes paying them. It’s something that we just have to do … but not always. If you’d like to hang on to your money, then look no further than your retirement accounts to find the best tax saving investment – your IRA and 401k. … [Read more...]
When Hitting Your 401k Max May Not Be To Your Advantage
If you read my advice often, then you know that I am constantly encouraging you to save as much as possible for retirement. Why? Because I want you to be wealthy, take advantage of tax free savings, and reach financial freedom as quickly as possible. And even though I continually advocate all the benefits of hitting your 401k max, sometimes it’s just not going to be practical or feasible if you have a limited income. In fact in a few cases, there may be other things you need to consider that may work out better for you long term. … [Read more...]
What Does IRA Stand For Anyways?
If you’ve ever wondered “ what does IRA stand for ?”, then you may be surprised to find out that the IRS defines it as an “individual retirement arrangement”. This is slightly different than the common definition of an “individual retirement account”. Although similar, an individual retirement account is simply one form of the broader range of individual retirement arrangements that exist under the US Publication 590 (the laws where IRA’s come from). … [Read more...]
Roth IRA Contribution Rules for 2013
Roth IRAs are one of a variety of types of individual retirement arrangements that are regulated by the IRS and are designed to help individuals save for retirement. The unique aspect of a Roth IRA is that the money you put into the account has already been taxed. This means that you do not have to pay taxes on your contributions when you start withdrawing your funds at age 59 ½. In addition, the money earned in the account on top of your contributions is tax exempt as long as you withdraw it in accordance to the IRA contribution rules as defined by the IRS. … [Read more...]
What Is a Non Deductible IRA and How Do I Contribute To One?
If you think you make too much income to stash away your money away into an individual retirement arrangement (IRA), then I have good news for you. Very few people realize that you can contribute to a non deductible IRA regardless of your income level and still enjoy the benefits of tax free investment growth. Using this account to boost your retirement nest egg will make a great addition in your overall strategy to maximize the potential of your 401k and IRA savings. … [Read more...]
All the Great Things About Reaching Your Maximum 401k Contribution
Do you make the maximum 401k contribution to your account every year? If you don’t, you have no idea what you’re missing out on. Saving money in your employer sponsored plan isn’t just about putting a little bit away at a time with no plan or end goal in mind. It’s about using your time and the power of compound returns to create the most gain you possibly can. … [Read more...]
IRA Contribution Limits and How to Get the Most Out of Them
When you compare the IRA vs 401k, you'll find that the IRA contribution limits are considerably smaller. The major factors that will affect these rates will be your income level, marital status, and age. It is also very important to be aware that the type of IRA you choose for your money may also have hidden advantages (as we’ll illustrate in the example below). Traditional and Roth IRA Contribution Limits: The current IRA contribution limits for either a Traditional or Roth in 2013 are $5,500 for individuals age 49 and younger, and $6,500 for individuals age 50 and older (starting in the year that you turn 50). Both of these … [Read more...]