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URL:  http://boards.fool.com/ltltideally-of-course-we-would-like-to-10181279.aspx

Subject:  Re: Retirement savings Date:  5/15/1998  3:11 PM
Author:  PSUEngineerFool Number:  3322 of 75335

<<Ideally, of course, we would like to invest in the stock market in some sort of tax-deferred manner
or with tax-free earnings. Given that we are participating in the 401K plan, can we also open an
IRA account? What is the maximum each of us can contribute to this on a yearly basis?

Is it possible to open both an IRA and a Roth IRA, or is one permitted to open only one? Are there other tax-free investments worth considering? Government bonds, etc?>>

Yes, you may open either a traditional IRA or Roth IRA or both, but total contributions cannot exceed $2000 for each of you. This means you can contibute $2000 to a tradition or $2000 to Roth IRA or some combination of $2000 to both, but do not exceed $2000 overall.

It would appear from your description of your finances that you would only be able to make non-deductable contibutions. Therefore, it would make sense to only open a Roth IRA.

In regards to maximizing tax-deferred investments, I will borrow a phrase from CodyZen, "IMHO one should not use 'reducing taxes' as a major objective in making investment decisions."

Your situation seem similar to another couples on another thread titled 'Are variable annuities a reasonable option?' You will find CodyZen's advice and other great advice as you read this thread. It can be found at the following link:

http://boards.fool.com/Message.asp?id=1040013000866000&sort=postdate

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