| I keep hearing Roth IRA but is there something else. |
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ccjoshua
New Member
Cash: $ 0.70
Posts: 3
Joined: 18 Dec 2005
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| I keep hearing Roth IRA but is there something else. |
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I will be well out of the $110K range in the next year or two. So opening an IRA for a couple years doesn't seem like a smart idea. What should I do with my money.
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Fri Dec 23, 2005 4:36 pm |
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Rolo
Yo' Daddy
Cash: $ 309.70
Posts: 1551
Joined: 13 Mar 2005
Location: Colorado/Florida
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Is all $110K taxable income?
"Expect me when you see me."
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Fri Dec 23, 2005 5:31 pm |
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auggyf
Full Member
Cash: $ 19.90
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Joined: 24 Sep 2005
Location: San Francisco
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You may want to consider maxing out your 401K (if you have an employer that supports it). Also, you may want to consider keeping money in a private account and putting money into low-turnover, low-yield funds (such as a broad stock market index). You may end up paying less tax on this money at retirement than you would in a 401K, if you expect long term capital gains to continue to get the same tax treatment we get for it now.
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Fri Dec 23, 2005 6:08 pm |
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DollarSteward
Member
Cash: $ 2.65
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Joined: 07 Dec 2005
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It's true that you will be ineligible to contribute to a Roth IRA but you could still take advantage of the tax deferred growth offered by a traditional IRA. These contributions may or may not be tax deductible depending on your contributions to a work retirement plan (if any). Try to explore all the tax advantaged retirement savings options before looking to taxable accounts.
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Fri Dec 23, 2005 6:34 pm |
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Rolo
Yo' Daddy
Cash: $ 309.70
Posts: 1551
Joined: 13 Mar 2005
Location: Colorado/Florida
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quote:
Originally posted by DollarSteward
Try to explore all the tax advantaged retirement savings options before looking to taxable accounts.
Agreed. However, taxes should not be the be-all primary reason for investment decisions but weighed as part of the overall formula. i.e. Don't sacrifice quality returns for fear of paying taxes on the gains.
Besides, hold your equities for over a year and you get the cheaper capital gains rate.
"Expect me when you see me."
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Fri Dec 23, 2005 7:00 pm |
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ccjoshua
New Member
Cash: $ 0.70
Posts: 3
Joined: 18 Dec 2005
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Next year I will no longer be considered an employee. I will be an independant contractor, and even so my employer has no 401k plan. I'm 22 and pretty new to all of this. My parents never saved a dime, and I just don't want to be in their situation when I'm older.
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Sat Dec 24, 2005 5:00 pm |
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Rolo
Yo' Daddy
Cash: $ 309.70
Posts: 1551
Joined: 13 Mar 2005
Location: Colorado/Florida
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quote:
Originally posted by ccjoshua
independant contractor
Oh! Self-Employed IRA (SEP IRA). You can contribute up to 25% of your income (20% is how it really works out) and it works just like a traditional IRA.
"Expect me when you see me."
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Sat Dec 24, 2005 7:21 pm |
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