Blogs
Backdoor Roth IRA: What it is and How to Set One Up?
If you want the take advantage of current low-income tax rates and set yourself up for tax-free income in retirement, Roth IRA is the best option. However, Roth IRA is unfortunately not an option for people with high incomes. But there is a way high-income earners can...
Roth IRA Rules: Eligibility, Contributions and Withdrawal Rules for 2023
A Roth IRA is an excellent tool to put away money for your retirement. However, like all other tax-advantaged retirement plans, there are some rules regarding the taxation of contributions and withdrawals. There are income limits for participating in these plans and...
What Happens if you Contribute Too Much to a 401(k)
Maxing out your 401(k) contributions is a good thing. It means that you are making the most out of your employer-sponsored retirement account to enjoy worry-free golden years. Over contributing to your 401(k) isn't allowed, but it's easy to do it by mistake. If you...
Understanding Marginal VS Effective Tax Rate
The United States has a progressive tax system. What this means is the more money you earn, the more income tax you will pay. There are currently seven tax brackets ranging from 10% to 37%. If you are single and earn $35,000 per year, your tax rate is 12%. If you are...
Pension Rollover to IRA: Rules, Pros, Cons and More
Can you roll over a pension plan into an IRA? Yes, provided it meets two criteria: the pension plan is a "qualified employee plan" (if you've been deferring tax on your contributions, your plan is most likely a qualified plan), and you must have left the company or...
How Can I Get My 401(K) Money Without Paying Taxes
How are 401(k) withdrawals taxed? When you take distributions from a regular or traditional 401(k), they are treated as normal income and subject to income tax. Since your contributions to traditional 401(k) were paid with pre-tax dollars, you are liable to pay taxes...
Independent living for Seniors: A Complete Guide
As an independent senior living in a thriving community can keep you healthy and happy as you age. As well as carefully researching each living option and what it has to offer.
Penalties of Withdrawing From 401(k) and How to Avoid Them
401(k) plans are designed to help you save for retirement. Therefore, the IRS discourages withdrawals from 401(k) plans until you turn 59 ½. If you are trying to withdraw early from your 401(k) – before you reach the magical age –you will have to pay a steep price for...
Secure act 2.0 Other Changes (passed by house, not Senate or the “Prez”)
Secure act 2.0 Other Changes include the following: Increasing the required first-year required minimum distribution (RMD) age over time from age 72 to age 75. Indexing $1,000 IRA catch up contributions for inflation. Increasing the limit on catch-up...
401(K) Rollover to IRA
If you have changed jobs, it's important to understand the several options you have with your old 401(k) retirement account. Typically, you have four options: You can cash it out Leave it as and where it is Transfer it into your new employer's 401(k) plan (if one...
When Can You withdraw from 401(K)?
401(k)s are tax-advantaged retirement savings accounts, and many Americans pour money into them every year. Generally, if you withdraw from your 401(k) before age 59 ½, you are likely to attract income tax and a 10% penalty on the amount that you withdraw, in addition...
How Does 401(k) Withdrawal Affect Tax Return?
Most 401(k) plans are tax-deferred, which means there is no income tax on contributions or earnings until the owner decides to withdraw it. However, a Roth 401(k) is a little different. In a Roth 401(k), the contributions are taxed, and the withdrawals are tax-free....