Saving for Retirement

Plan for a secure retirement with our comprehensive guide on saving for retirement. This resource covers various retirement savings options, including Traditional IRAs, Roth IRAs, SIMPLE IRAs, and defined contribution plans like 401(k) and 403(b) plans. It explains the contribution limits, eligibility requirements, and tax advantages of each option, helping you make informed decisions to maximize your retirement savings and minimize tax liabilities.

Highlights:

• Traditional IRAs: Contributions are tax-deductible, with limits up to $7,000 ($8,000 for those 50 and older) for 2024. Subject to income phaseouts if covered by an employer-sponsored plan.

• Roth IRAs: Contributions are made with after-tax dollars, allowing for tax-free withdrawals under certain conditions. Income limits apply.

• SIMPLE IRAs: Designed for small businesses with 100 or fewer employees, allowing both employer and employee contributions.

• Defined Contribution Plans: Includes 401(k) and 403(b) plans, with elective deferrals up to $23,000 ($30,500 for those 50 and older) for 2024.

• Prohibited Transactions: Penalties apply for using IRA funds in prohibited transactions, such as borrowing from the IRA or using it as loan collateral.

• Retirement Savings Contribution Credit: Tax credit for low to moderate-income individuals contributing to retirement accounts, with percentages varying based on adjusted gross income.