Whether you are a veteran in your career or you are working an hourly job you still have time to contribute to your Traditional IRA if you were under 70 years and 6 months old by the end of 2019 and receive taxable compensation. IRA or individual retirement accounts are alternative to employer-related accounts. If you are not sure this would be of help to you, consider some of these benefits and tips to make the most out of your IRA.
- You can write off your IRA as a tax deduction if you choose a traditional IRA.
- Your contributions will be higher than a traditional retirement fund with a company.
- Currently, you can contribute up to $6000 or $7000 if you’re older than 50.
- As the years progress the bracket that you can contribute will be raised to match inflation.
- Do not withdraw money from your IRA until you are ready to retire. If you withdraw money before you are ready to retire then you are going to be taxed around 10% of your IRA earnings.
- Speak to a financial advisor. They are legally bound to keep your best interest in mind.
- If you want to withdraw or are over the age of 70.5 years you can set up Roth IRA and there is no limitation on your contribution amount.
- If you are over 50, take advantage of catch up contributions. Catch up contributions this year were about $1000 higher.
It’s not too late for IRA contributions. There are options for everyone in every walk of life. The Roth IRA is for those who don’t make a lot. For the employed individual, a traditional IRA is ideal unless you passed the 70.5-year-old mark. If you must withdraw the Roth is also ideal. Speak to your local tax representative and figure out which IRA is best for your situation. Keep Franek in mind if you’d like to set up an IRA or are looking for ways to maintain the one you already have.