The deadline for adding to your IRA is April 18th.
- The Roth IRA is a type of retirement savings account that allows individuals to contribute after-tax income
- Contributions are not tax-deductible, but earnings on investments within the account grow tax-free and can be withdrawn tax-free in retirement
- Attractive to many people because it allows them to pay taxes on their contributions upfront and not on withdrawal in retirement
- Current contribution limits are $6,000 per year for individuals under 50 and $7,000 per year for individuals over 50
- High-income earners may not be eligible to contribute to a Roth IRA
- Some people use a “backdoor Roth conversion” strategy to contribute to a traditional IRA and then convert it to a Roth IRA
- It is important to work with a competent financial advisor to understand the complexities of retirement savings plans and ensure contributions are made on time.