When it comes to retirement accounts, an IRA is one of the most popular solutions among those who are planning for retirement and looking to save. Samuel Rad and his team can assist you in determining in what type of IRA is right for you. Already have an IRA? It’s important to re-evaluate your retirement accounts on a regular basis to make sure that the type of accounts that you have are still meeting or exceeding your goals.
There are three main types of IRA’s: Traditional IRA’s, Roth IRA’s and SEP IRA’s. All three types are meant to help people save for retirement, but they’re all a little different.
Traditional IRA’s: With this type of IRA, pre-tax dollars are put into the account and are allowed to grow tax deferred. When a person reaches the age set forth by the IRS as being able to take withdrawals from their IRA without penalty, the money is treated for taxing purposes as ordinary income and is taxed as such.
Roth IRA’s: The difference between a Roth and Traditional IRA is that contributions are not tax free, but once a person reaches the age set forth by the IRS to be able to withdraw without penalty, the withdrawals are not taxed.
SEP IRA’s: A SEP (Simplified Employee Pension) IRA can be established by employers or by those who are self-employed. Contributions that are made into this type of IRA provide the employer with a tax deduction.
One of the main advantages of an IRA is that there are commonly tax advantages associated with this type of retirement account; either when contributions are made or withdrawn depending on the type of IRA. Additional tax benefits may be available depending on a person’s specific circumstances.
Another benefit of IRA’s is that sometimes people change employers and they don’t have anywhere to move their 401k account; or a person retires and finds that leaving their money in their employer’s 401k plan is not the best option. A 401k account can usually be rolled over into an IRA account so that a person can continue to save for their retirement. However, it’s very important to seek professional assistance when moving or rolling over retirement accounts so that you don’t end up paying an early withdrawal penalty.
For all of your Traditional IRA, Roth IRA or SEP IRA needs in Los Angeles, California and the surrounding areas, contact Samuel Rad and his team using the contact form. Samuel and his team are looking forward to speaking with you and assisting you with your retirement goals.