{"id":7575,"date":"2014-10-27T07:19:48","date_gmt":"2014-10-27T13:19:48","guid":{"rendered":"http:\/\/www.coolchecks.net\/blog\/?p=7575"},"modified":"2014-10-27T07:19:50","modified_gmt":"2014-10-27T13:19:50","slug":"heres-the-scoop-on-roth-iras","status":"publish","type":"post","link":"https:\/\/www.coolchecks.net\/blog\/finance\/personal-finance\/heres-the-scoop-on-roth-iras.html","title":{"rendered":"Here\u2019s The Scoop on Roth IRAs"},"content":{"rendered":"

\"Make<\/a>
Make saving money automatic every month. The easier it is to save the better for you in the long run.<\/figcaption><\/figure>Many Americans have a Roth IRA as one component in their retirement scheme, or rely on such an Individual Retirement Account as the mainstay of their plans.<\/p>\n

A 19-year-old who began contributing $1,500 to such an account could expect to have some $608,000 by age 65, given 7 percent average annual earnings. That\u2019s a healthy bit of money to support one\u2019s post-employment years. <\/p>\n

Of course, not every Roth IRA holder leaves his savings to accumulate that much retirement income, but the prospect of being able to make a large purchase (a down payment on a home, perhaps?) is also enticing. <\/p>\n

Money goes into a Roth IRA and accrues interest completely tax free until it can be withdrawn, usually after the holder is age 59\u00bd or older. Studies show that a Roth IRA usually is started by someone 18 to 39. There is no minimum age requirement so young people who have earned income are eligible. <\/p>\n

The Roth IRA is one of few savings methods that allow putting after-tax money into an account and withdrawing it tax-free. So, if you began contributing the $5,500 allowable deposit this year, and maintained that level for 25 years at a 3 percent return, you\u2019d accumulate $200,525, with $63,025 in tax-free earnings.<\/p>\n

While the original idea behind IRAs was to build retirement security, this method of savings now is used by many individuals to put money aside for purchasing a home or paying for advanced education.<\/p>\n

A Roth IRA involves income limits. Single individuals can contribute if their modified adjusted gross income is less than $129,000. The contributions phase out as modified adjusted gross income reaches $114,000. For couples, the limits run from $181,000 to $191,000 filing jointly. <\/p>\n

Your Roth IRA contributions are not tax deductible, but the earnings grow tax-free. You don\u2019t pay taxes when you withdraw from your account if it has been growing for at least five years. <\/p>\n

Withdrawals usually begin at 59 \u00bd , when you become disabled or die (in which case the money goes to a beneficiary), or if you are purchasing a first-time home, which allows a $10,000 one-time withdrawal.<\/p>\n

Traditional IRAs require that you begin withdrawing money at age 70 \u00bd , but Roth IRAs do not have that requirement. You can convert from a regular IRA to a Roth IRA, but distributions will be taxed in the year you do. <\/p>\n

If you will be in the same or a higher tax bracket during retirement, the Roth IRA is a good option, but if you are in need of tax deductions now, a traditional IRA is probably your best bet.<\/p>\n","protected":false},"excerpt":{"rendered":"

Many Americans have a Roth IRA as one component in their retirement scheme, or rely on such an Individual Retirement Account as the mainstay of their plans. A 19-year-old who began contributing $1,500 to such an account could expect to have some $608,000 by age 65, given 7 percent average annual earnings. That\u2019s a healthy […]<\/p>\n","protected":false},"author":53,"featured_media":7569,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_genesis_hide_title":false,"_genesis_hide_breadcrumbs":false,"_genesis_hide_singular_image":false,"_genesis_hide_footer_widgets":false,"_genesis_custom_body_class":"","_genesis_custom_post_class":"","_genesis_layout":"","footnotes":""},"categories":[69],"tags":[669],"_links":{"self":[{"href":"https:\/\/www.coolchecks.net\/blog\/wp-json\/wp\/v2\/posts\/7575"}],"collection":[{"href":"https:\/\/www.coolchecks.net\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.coolchecks.net\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.coolchecks.net\/blog\/wp-json\/wp\/v2\/users\/53"}],"replies":[{"embeddable":true,"href":"https:\/\/www.coolchecks.net\/blog\/wp-json\/wp\/v2\/comments?post=7575"}],"version-history":[{"count":0,"href":"https:\/\/www.coolchecks.net\/blog\/wp-json\/wp\/v2\/posts\/7575\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.coolchecks.net\/blog\/wp-json\/"}],"wp:attachment":[{"href":"https:\/\/www.coolchecks.net\/blog\/wp-json\/wp\/v2\/media?parent=7575"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.coolchecks.net\/blog\/wp-json\/wp\/v2\/categories?post=7575"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.coolchecks.net\/blog\/wp-json\/wp\/v2\/tags?post=7575"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}