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Investing/Strategies / Retirement Investing
|Subject: Re: Simple IRA Questions?||Date: 11/14/1998 9:43 AM|
|Author: TMFPixy||Number: 6610 of 77407|
Greatings, JakeDeath, and welcome. You asked:
<<I have some simple IRA questions that I thought I'd try to get answered on TMF... so here goes:
1. Can someone please recommend a URL where I can educate myself on IRA basics (eligibility, tax info, ROTH vs. Traditional, etc.)?>>
Sure. You can find an explanation of the various types of IRA in my Foolish Retirement Plan Primer accessible at http://www.fool.com/retirement . For information on the Roth IRA, you also want to look at my analysis at http://boards.fool.com/Registered/Message.asp?id=1040013000441002&sort=postdate . Both will give you a good overview of the issues involved in IRA investing.
<<2. I'm in my employer's 401K... My wife is not employed. We file jointly with gross income <150K. From what I've read, it looks like she can setup/contribute to a traditional IRA and take the deduction. It looks like I can't setup a Traditional in my name... but I can have my own Roth IRA. Is this correct?>>
You are correct that your wife may contribute $2K to a deductible traditional IRA for herself. You may do so as well subject to limitations based on your adjusted gross income (AGI). If your AGI is less than $50K, then you may contribute and deduct $2K per year. Between an AGI of $50K to $60K, you may still contribute $2K, but the deductibility of that contribution phases out. At an AGI of over $60K there may be no deduction for your contribution. See my Roth analysis to see if a Roth or deductible IRA is a "better" choice for you. If your only choice is a nondeductible traditional IRA or a Roth, then the Roth will definitely be better because of the ultimate tax free distributions it provides.
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