Friday, January 27, 2006

Starting a Roth IRA

From the same site (The Motley Fool) comes an article about setting up a Roth IRA. The site compares three vendors, but there are countless other vendors that will help you set up a Roth IRA.

What are the benefits of the Roth IRA? If you qualify, you can invest a relatively small sum every year ($4000 until 2007 and then $5000 in 2008 and then small increases afterward) in a tax-sheltered tool. You don't pay taxes on the money you gain from the Roth IRA. The reasoning being of course, because you already paid taxes on the money you put into it. In order to qualify you have to have an income of below $95,000 a year if you are single or $150,000 a year if you are married.

I haven't set up my own Roth IRA yet, but there is still time to place some money in a 2005 Roth IRA for tax purposes and the benefit of being able to place more money into it in 2006. April 15, 2006 is the deadline, so you still have time. What are you waiting for?

No comments: