UnThreaded | Threaded | Whole Thread (31) | Ignore Thread Prev | Next
Author: intercst Big funky green star, 20000 posts Top Favorite Fools Top Recommended Fools Feste Award Nominee! Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: of 79066  
Subject: Re: not eligible for roth Date: 5/6/1999 8:18 PM
Post New | Post Reply | Reply Later | Create Poll Report this Post | Recommend it!
Recommendations: 0
aq67sceb wrote,

Or if you are unable to make a contribution to a traditional IRA and are left with the choice of a
non-deductable IRA or a Roth IRA.

In that case it is a no-brainer.

I agree.

Also, if you're not eligible for a Roth, there may be some advantages to forgoing a non-deductible IRA and just investing for retirement in a taxable account.

If you're a LTB&H investor with mostly stocks in your retirement portfolio an IRA may actually reduce your after tax return. You pay ordinary income tax on your IRA gains (max=39.6%) whereas capital gains in a taxable account are taxed at a maximum of 20%. Of course, this only works if you keep your trading to an absolute minimum.

It also avoids all the IRA restrictions regarding early withdrawals and minimum distributions after age 70 1/2.

Post New | Post Reply | Reply Later | Create Poll Report this Post | Recommend it!
Print the post  
UnThreaded | Threaded | Whole Thread (31) | Ignore Thread Prev | Next


The Retire Early Home Page
Discussion on accelerating retirement day.
Foolanthropy 2015!
Fistula Foundation: A World of Good!
When Life Gives You Lemons
We all have had hardships and made poor decisions. The important thing is how we respond and grow. Read the story of a Fool who started from nothing, and looks to gain everything.
What was Your Dumbest Investment?
Share it with us -- and learn from others' stories of flubs.
Community Home
Speak Your Mind, Start Your Blog, Rate Your Stocks

Community Team Fools - who are those TMF's?
Contact Us
Contact Customer Service and other Fool departments here.
Work for Fools?
Winner of the Washingtonian great places to work, and Glassdoor #1 Company to Work For 2015! Have access to all of TMF's online and email products for FREE, and be paid for your contributions to TMF! Click the link and start your Fool career.