The Trifecta in Roth IRAs

Improve your odds of achieving financial independence by investigating these strategies now.

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As cash bonuses, capital gains distributions, and holiday cash gifts provide ample liquidity, consider the opportunities that abound for funding Roth IRA accounts.

In a perfect world, we would probably want all of our money in Roth IRA accounts. The reason is simple: tax free growth over your entire lifetime, and perhaps even longer if heirs understand their stretch opportunities.

  • Between now and December 31, 2013, you have the opportunity to decide how much to convert to a Roth IRA. Any amounts converted will be taxed now, but will enjoy tax free lifetime growth. Even if you are in a high tax bracket, the critical question is will you ever be in a lower tax bracket? For many people the answer is no, even in retirement.
  • As the New Year rings in, you will also have the opportunity to contribute to a Roth IRA for 2014. Investing at the beginning of a new tax year gives you the benefit of earning money on your investments all year long. In the case of 2013, the S&P 500 has advanced over 26.5%, as of November 22, 2013. If you failed to contribute in the beginning of the year, this growth remains stubbornly taxable.*
  • Contributions for 2013 can also still be made until April 15, 2014. Currently, the maximum you can contribute in both 2013 and 2014 is $5,500 if you are under age 50 and $6,500 is you are over age 50.*

*There are adjusted gross income (AGI) phase outs for contributions. If your joint adjusted gross income is over $178,000, your contribution amount will be lowered until it is completely phased out at an AGI level of $188,000. For single taxpayers, the initial phase over AGI level is $112,000 and is completely phased out at $127,000.

The trifecta of a conversion, along with a 2013 and 2014 contribution are all possible within the next two weeks. Improve your odds of achieving financial independence by investigating these strategies now.

Will Your Money Last Through Retirement?

No one wants to run out of money. But without goals and a solid plan,
how can you know for sure whether you’re on the right track?

Will I be able to maintain my current lifestyle?

What will my monthly income be in retirement?

Can I protect my hard-earned savings and still
have the income I want?

Rodgers & Associates answers questions like these every day.

Get Personalized Answers
2025 Lititz Pike, Lancaster, PA 17601
Phone: 717-560-3800, Toll-Free: 888-876-3437