By Todd I. Youngdahl, CFP®
Roth IRAs are great savings vehicles for many reasons. They can be a tax-free income source in retirement. They don’t have required minimum distributions when you reach age 70½ as with most other tax-advantaged retirement plans. And, they have flexible inheritance rules that will benefit your children and grandchildren.
The only problem with Roth IRAs is that you may not be eligible for one. You likely make too much money. For 2019, you are ineligible to contribute directly to a Roth IRA if you are single with an adjusted gross income (AGI) over $137,000 or a married couple with an AGI over $203,000.
Why tout the benefits of a Roth IRA to people who may be unable to contribute directly to one? Another contribution path exists. It is called a Backdoor Roth IRA which offers an alternative way to make contributions to a Roth IRA.
By Maura C. Schauss, CFP® and Jane Huang, MBA, CFP®
If you’ve been frustrated by the complexity and inflexibility surrounding your federal Thrift Savings Plan (TSP), you’re not alone. Fortunately, many of the rules and restrictions surrounding your options for contributing and withdrawing will be relaxed when the TSP Modernization act goes into effect on September 15th, 2019. The new rules are designed to give you more control over your money and apply to all TSP account owners, regardless of whether or not you’re already receiving monthly payments. The top three changes to TSP withdrawals in 2019 are greater flexibility in partial withdrawals, making withdrawal changes at any time, and the ability to choose which accounts your withdrawals are coming from.
By Todd Youngdahl, CFP®
Retirement planning is far from simple. While that may seem like a blatant understatement, it’s especially true when you start looking at all your options and try to determine what is right for you. Each of your many options has pros and cons, unique opportunities, and various fees. While you know you need to invest, it can be challenging to decide what the best choice is for you and your unique situation.
Today, we’re focusing on the Roth and the opportunities it can provide to investors.