Anybody doing a last minute IRA?

Any tips?

AFAIK IRA=Irish Republican Army.

Cryptic secret messages?

Cheers
Mick

edit: Sorry, Surreal, my sense of humour was tickled by your acronym. Not all of us put in US tax returns.

Hmm, and a Google on IRA turns up some interesting pages.

Originally posted by mickwish
AFAIK IRA=Irish Republican Army.

Cryptic secret messages?

Cheers
Mick

edit: Sorry, Surreal, my sense of humour was tickled by your acronym. Not all of us put in US tax returns.

Hmm, and a Google on IRA turns up some interesting pages.

Why did you crap on my thread? BTW, I know how to use Google.

I think you can now put in $3000 in traditional and Roth and you have till 3/31/03. There's nothing to it. Very straightforward. Just open the IRA account in any Bank/financial institution. You can specify what kind of underlying investments should be made from your fund: mutual funds (you can specify according to your risk tolerance, time horizon -meaning when you plan to retire- but don't worry on that since you have a looooong way to go), growth stocks, bonds/treasuries/Ginnie Maes and so on.

Takes about an hour total at a bank.

There's nothing else I can think of.

[daveleau]

Last minute IRA? What's last minute about it?

I would suggest a ROTH IRA as well. Get one that has a long track record. There are many that date back before the heavy recession of the early 70s. It would be good to choose one that performed well through that, since it is not very telling if an IRA shows good growth in the bull markets of the 80s and 90s. You need to find one whose track record showed that it survived the bad times as well.

With a ROTH, you pay the taxes up front. So, when you take the money out after it has grown, it is tax free. It is limited to $3000, but is going up to $5000 soon (next year???). If you want to invest more, you can open regular IRAs without an investment limit. These you do not pay taxes on at the beginning. You pay taxes on these when you take the money out, and thus pay tax on the large amount.

But can you deduct your ROTH from 2002 taxes like you can the IRA? The IRA is 2k. And a ROTH is 3K? For just one person?


edit! doh! never mind the deduct the ROTH question... brain fart!


Last minute cause I never gave it a thought before I was doing my taxes!

[daveleau]

IRA is unlimited as to the amount you can put in per year. The ROTH is a nice tax shelter and that is why it is limited to $3K/ year. You pay taxes on $3000 now, but get much more tax free later. A regular IRA is taxed at the end, so it is not as nice of a tax shelter.

A regular IRA, which is taxed at the end when withdrawn, has some other advantages. When you take out from it after retiring, your tax rate is likely to be lower than it would be when you are fully employed. So, if you are in the 30% tax bracket, you don't pay this 30% tax and your money grows. When you take it out, you may be in a lower bracket, sya 20% so you save.

Depends on your circumstances.

Thanks guys!

[uethello]

Another thing to think about, depending on your tax bracket. I use an IRA that taxes on withdrawal. I take the extra money I get back on my tax return from the IRA money saved this year and put it into the IRA the next year. I think this yields a higher end result, as I said, depending on your bracket.