IRAs

Employers can contribute to traditional IRAs (SEP-IRAs) set up for their employees under a SEP plan. A SEP can be established by any size firm, including self-employed individuals. What is a SEP IRA and how does it work? A Simplified Employee Pension (SEP) plan allows business owners to contribute to both their employees’ retirement and […]

Roth IRAs have existed since 1997, and Roth 401(k)s were introduced in 2001. A Roth 401(k) is better for high-income employees since it provides for higher contribution limits and employer matching funds. A Roth IRA allows you to contribute for a longer period of time, has a wider range of investment alternatives, and provides for

A Roth contributory IRA is one that is funded by the account holder’s contributions rather than a rollover. In 2021, you can contribute up to $6,000 per year to a Roth IRA, or $7,000 if you are 50 or older at the end of the year. How does a Roth contributory IRA work? An IRA

A Roth IRA is a type of individual retirement account in which you pay taxes on the money you put into it but not on any future withdrawals. When you think your marginal taxes will be greater in retirement than they are today, Roth IRAs are the way to go. If you earn too much

An Individual Retirement Account (IRA) that you contribute after-tax monies to is known as a Roth IRA. While there are no tax benefits in the current year, your contributions and earnings can grow tax-free, and you can take them tax- and penalty-free after reaching the age of 591/2 and having the account open for five

A Roth IRA is a type of individual retirement account in which you pay taxes on the money you put into it but not on any future withdrawals. When you think your marginal taxes will be greater in retirement than they are today, Roth IRAs are the way to go. If you earn too much

The IRA base of a Roth IRA refers to the contributions made to the Roth IRA. These monies can be withdrawn and utilized without incurring any tax liability. In contrast, money you withdraw and spend for investments in a regular IRA is subject to income taxes. How do I calculate the cost basis of a

Transferring retirement savings from a standard IRA or 401(k) to a Roth account is known as a Roth IRA conversion. Because the former is tax-deferred and the latter is tax-free, the deferred income taxes owed on the converted money must be paid at that time. There is no penalty for withdrawing early. This technique makes

A Roth IRA CD is essentially a certificate of deposit kept inside a Roth IRA, similar to the certificates of deposit you might see promoted at your local bank. It functions similarly to a CD, with a fixed interest rate for the duration of the CD, which can range from six months to ten years.

When you transfer assets from a Traditional, SEP, or SIMPLE IRA (collectively referred to as a Traditional IRA in this article) or a qualified employer sponsored retirement plan (QRP) — such as a 401(k), 403(b), or governmental 457(b) — to a Roth IRA, it is known as a Roth conversion. When you convert your pre-tax