Part 5: How will an IRA impact your retirement in the future

Good morning Women Supporting Women,

Happy Monday to you all!  I hope you had a fantastic week.  I spent my weekend at the YWCA, participating in an Empowerment Tea Party, hosted by my client’s organization, Hunks 4 Hope.  This organization brings awareness to Domestic Violence and to women who have experienced hard times during their lives.  I had the opportunity to educate the ladies about my passion: life planning.  My heart was full from this wonderful event.  The rest of the weekend was dedicated to appointments and worship.  As always, it was a great one.

We are now up to the last part of our 5 part series, which focused on IRAs.

Last week, I wrote about why someone would consider rolling over their IRA from a previous employer.  This week, we will focus on how an IRA can impact your retirement dollars.

The Impact

While a lot of people may have some type of retirement plan with their employer (401K, 403B or 457), you still need to take advantage of setting up an additional nest egg for yourself.  As we know, the whole purpose of an IRA is to have more money in retirement, while possibly receiving tax deductions (Traditional IRA) or tax credits (Roth IRA) prior to retirement. Remember, the traditional  IRA is tax deferred (pay taxes later) and you must start taking money out of this type of IRA by age 70 1/2 (RMDs – Required Minimum Distributions).  With the Roth IRA, as long as you’ve had it for at least 5 years and are 59 1/2 years of age (age where you no longer receive a 10% IRS penalty for an early withdrawal), you are free to withdraw this money Tax FREE.  Also, Roth IRAs are not mandated by the 70 1/2 RMD rule.  So in addition to what you can put into your retirement plan at work, you can start your IRA and take advantage of some of the perks they provide.

Due to inflation, the money we have saved up today, might not be enough for the future.  Speak to your accountant about which IRA would benefit you the most.

If you have any questions, please feel free to post here or email me at:

thefinancialcomforter@gmail.com

This concludes our series on IRAs.

Next week:  Review of IRAs to win a gift card

Have a beautiful and blessed week!

Marsha

Changing the lives in our community….one family at a time

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