UnThreaded | Threaded | Whole Thread (3) | Ignore Thread Prev | Next
Author: buzman Big red star, 1000 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: of 79066  
Subject: Re: taxable IRA after maxing 403b Date: 1/11/2004 10:51 PM
Post New | Post Reply | Reply Later | Create Poll Report this Post | Recommend it!
Recommendations: 0
I plan to contribute the max to my 403b this year but can afford to save more. Very good

I read that you can still contribute further to a traditional IRA, but this contribution will be taxable. If so, in what sense is this an IRA? No you misunderstood. You can contribute to a traditonal IRA but the contributions are not deductible. Furthermore you can contribute to a ROTH IRA, subject to AGI limitations, however the Roth contributions are not deductible, either.

How is this different than just setting up a taxable investment account? Big difference, IRA contributions grow tax-deferred so you don't pay taxes each year. The taxable investment account would be subject to LTCG tax on assets held greater than one year but IRA distributions are taxed as OI.

The main advantage of a retirement account is that the "withdrawal restrictions" tend to act as a deterrent to one blowing the money on bull$it.



Post New | Post Reply | Reply Later | Create Poll Report this Post | Recommend it!
Print the post  
UnThreaded | Threaded | Whole Thread (3) | 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.