|
If you are employed, you should take
advantage of every option available to you to save for your retirement.
One of the best ways is by participating in a retirement plan where you
work, such as a 401(k). But if you don't have such a plan...or even if you
do and would like to invest more for retirement...you can contribute to an
Individual Retirement Account or IRA to build a tax-deferred nest egg for
the future.
A Traditional IRA can be opened by anyone with earned income who is
younger than 70½. A Roth IRA can be opened by anyone with earned
income, regardless of age, if their adjusted gross income (AGI) is below
$120,000 (single) or $176,000 (joint).
For 2009, you can
invest up to $5,000 in an IRA. If you're older than 50, there's a "catch-up
provision" that allows you to invest an additional $1,000 more than
younger workers. A non-working spouse can also contribute to an IRA
at the same level.
The final deadline for making prior year IRA
contributions is typically April 15. For example, a contribution for tax
year 2009 may be made up until April 15, 2009.
Your IRA money is invested
as you decide, in the type of IRA you choose, to provide long-term,
tax-deferred growth. The type of IRA you select (Traditional or Roth IRA)
will determine whether your IRA investments are tax-deductible at
investment or tax-free at withdrawal. You'll want to examine the many IRA
choices available to you and select the one that is best suited to your
needs.
|
