UnThreaded | Threaded | Whole Thread (3) | Ignore Thread Prev | Next
Author: jyates1959 One star, 50 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: of 201  
Subject: Should I cash out my IRA? Date: 5/1/2011 3:44 PM
Post New | Post Reply | Reply Later | Create Poll Report this Post | Recommend it!
Recommendations: 0
Hi all,

I've recently become the beneficary of a trust that I receive funds from yearly that exceed my regular yearly gross income by times 2.

I've got no debt other than a fixed rate low interest home loan with about 8 years left on it (house payment less than $500 a month).

I started an traditional IRA a few years ago and have about $28,000 in current asset values.

My accountant told me that it didn't make good financial sense for me to put any more yearly contribuations into my IRA because I am very likely to be in a higher tax bracket in the years to come and that I would be better off paying taxes on my income now instead of paying taxes on the money later when I withdrew it from the IRA account.

I'm nearly 52 so it's not very long between now and the 59-1/2 age where I could start drawing out of the fund.

I was wondering if I really should not be contributing into the IRA why then I should let the money lie there and grow through the years (supposing it does grow, I'm invested in indiviual stocks that some have done well and some have bombed through the years).

Should I go ahead and cash the IRA out and take the 10% penalty and pay the taxes on the roughly $28,000 in value now or just manage the stocks (buying and selling) and let it grow (hopefully) and perhaps be in a higher bracket in 8 years and pay even more in taxes on it?

Thanks,
Jim
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

Announcements

Pencils of Promise - Back to School Drive
"Pencils of Promise works with communities across the globe to build schools and create programs that provide education opportunities for children."
Post of the Day:
Apple

Wal-Mart Nixes Apple Pay
What was Your Dumbest Investment?
Share it with us -- and learn from others' stories of flubs.
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.
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 "#1 Media Company to Work For" (BusinessInsider 2011)! 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.
Advertisement