My Retirement Blog
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Roth vs. 401K
My Roth and 401K strategy is to contribute to your 401K until you get your company match, then contribute the maximum to your Roth IRA, then contribute the maximum to your 401K. How does this compare to Walter Updegrave, a Money Magazine senior editor, and his Roth and 401K strategy? It’s exactly the same as…
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Four Types of Annuities: Fixed & Variable Deferred, Fixed & Variable Immediate
USA Today posted an article today about the four types of annuities and admitted that, while they aren’t the best game in town, they’re the only vehicle, outside of pensions and Social Security, to guarantee a lifetime flow of income in retirement (and you could argue the guarantee-ness of your company’s pension and Social Security).…
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Withdraw From Tax Deferred Accounts Last
When it comes time to begin taking disbursements from your retirement accounts, try to take them from your tax deferred or tax free accounts last (401k’s, Roth and Traditional IRAs) because you want them to grow tax-free as long as possible. If you opt to retire before 70.5, the age at which mandatory disbursements begin,…
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Highly Compensated Retirement Contribution Options
When you’re a “highly compensated employee,” you’re limited in how much you’re allowed to contribute to your 401(k). You are limited because the government wants the playing field to be level and it’s “unfair” to lower compensated employees if more highly compensated employees contributions outstrip the percentage for the lower compensated employees. Whether or not…
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Specify Your Roth IRA Contributions
Until April 15th, you can still make a contribution to your Roth IRA for 2006; but you can also make contributions to your Roth IRA for 2007 as well. So, it is important that when you send in your check, you specify which year it is for or your brokerage will likely add it as…
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Tax-Return Funded IRAs and Splitting Your Refund
Did you know that with the passing of the Pension Protection Act of 2006, you are now permitted to take your tax refund in three, as opposed to two, ways. The first two, as a check or a direct deposit into a savings or checking account, are still available but the Pension Protection Act added…
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Name Your IRA Beneficiary
It is critically important that you properly name your IRA beneficiary because, in the event of your demise (which will hopefully happen very far into the future), the tax ramifications change based on who you name as your beneficiary. Usually, your spouse, if you have one, will be able to inherit your IRA without any…
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10 Rules: Defer Taxes
This final tip in Forbes’ ten rules for building wealth starts dabbling in tax implications and how income and capital gains taxes will affect you investment decisions. The two tips they gives: Be aware of whether your sale will be a short term or long term capital gain. A short term capital gain will be…
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