Investing for your retirement is your responsibility. No one cares about your retirement as much as you do.
To help with your retirement investments you should learn as much as you possibly can. You should also be aware of the different rules of the different investment types.
There are many investments available to you in the market place. Which investment type you choose depends upon your personal situation.
You can choose to invest in a 401k account if your employer offers a 401k plan. You also have available to you a Traditional Individual Retirement Account or a Roth Individual Retirement Account.
We will be focusing mainly on Roth IRA’s. To help you learn about Roth IRA’s we will detail for you the Roth IRA rules and also help define a self-directed Roth IRA.
Common Roth IRA Rules
The most common Roth IRA rules that investors ask about are the tax regulations for contributions and the Roth IRA limits.
Roth IRA Tax Regulations
The IRS regulations state that contributions to your Roth IRA are not tax-deductible; but after age 59 ½, your Roth IRA withdrawals are tax-free, because the money in that investment has already been taxed.
If you are close to retirement a Roth IRA may not be practical for you; ask your financial planner about your personal tax situation.
Roth IRA Limits
For 2009, 2010 and 2011, if eligible, the Roth IRA limits are $5,000 plus an additional $1000 if you are over age 50.
To be eligible to contribute to a Roth IRA, your adjusted gross income for 2009 must be under $120,000 if you are single and $176,000 if you are married.
For 2010, single, $120,000. Married, $177,000.
For 2011, single, $122,000. Married, $179,000.
Self Directed Roth IRA
When the Roth IRA rules refer to a self-directed Roth IRA, they can mean that you, the investor, get to direct or determine how you will invest the funds within that account. In a self-directed Roth IRA, you have complete discretion over the investment types.
Will you invest in mutual funds or stocks or bonds, that is all up to you, the investor.
Work with your financial planner on the best solution for your personal situation.