Click on a question to see the answer:
How do I know if I am
saving enough for retirement?
How often should I
evaluate my retirement plan?
A good rule of thumb is that reviews should be conducted annually
to make sure you are meeting your goals. Still, if there's a
life-altering event such as a change in marital status or income
level, then you shouldn't wait to calculate the effects this will
have on your retirement plans.
What is a Rollover
A Rollover IRA is a Traditional IRA established to receive any
eligible Rollover distributions from other retirement accounts you
may have. It is a way to consolidate all of your IRA's without
incurring any penalties, provided they are rolled directly into the
Rollover IRA. Eligible distributions from the following retirement
plans may be rolled over into a Rollover IRA:
- Qualified retirement plan trust such as a pension plan,
- profit sharing plan, 401(k) plan or
stock bonus plan
- Traditional IRA (does not include a Roth IRA or Coverdell
Education Savings Account)
- 403(a) annuity
- 403(b) arrangement
- Government 457(b) plan
- SEP IRA
- SIMPLE IRAs have restrictions. Within the first two years from
the date of your initial contribution, distributions from a SIMPLE
IRA can only be rolled into another SIMPLE IRA. After the initial
two-year period, distributions can be rolled over to a Rollover
Should I have a
If you're looking for a smart way to save for your retirement,
Traditional IRAs are easy and flexible, and one of the best
vehicles for retirement planning. Funding is simple - you're free
to choose when and how much you want to contribute (IRS
contribution limits apply). Your contributions may be tax
deductible, and the money you earn in your IRA is always
tax-deferred. That means you don't pay taxes on the earnings in
your IRA until retirement, when you may be in a lower tax bracket.
Early withdrawal penalties may apply prior to age 59.5.
Am I eligible for a
Anyone under the age of 70½ for the entire year, who has taxable
compensation or self-employment income (earned by sole proprietors
and partners) for the year, may establish and fund a Traditional
What is a Roth
Roth IRAs are an excellent supplement to an individual's retirement
income, but unlike the Traditional IRA, where your contributions
may be tax deductible, your Roth IRA contributions are never tax
deductible. Making contributions to a Roth IRA is flexible, just
like in a Traditional IRA, and you can choose when and how much you
want to contribute (IRS contribution limits apply). Early
withdrawal penalties may apply.
Who is eligible for a
Anyone with taxable compensation or self-employment income (earned
by sole proprietors and partners) for the year can open and fund a
Roth IRA. But, there are certain rules for making qualified
contributions to your Roth IRA that you should speak to a tax
advisor about. For example, to be eligible to make a participant
contribution, you must have a modified adjusted gross income (AGI)
that is less than a certain amount, depending on your tax-filing
What is a Simplified
Employee Pension Plan (SEP)?
A SEP is a qualified retirement plan set up as an individual
retirement account (IRA) in an employee's name. You can establish a
SEP for yourself if you own a small business, or you may
participate as an employee if you work for a company that sponsors
such a plan. The federal government outlines the requirements for
participation, the maximum annual contribution limits, and the
rules governing withdrawals. Contributions are tax deductible for a
business and earnings are tax-deferred. Qualified individuals can
contribute a fixed percentage of their earned net income (up to
$30,000 maximum annually). Early penalties may apply.
Who is eligible for a
Simplified Employee Pension (SEP)?
Many business owners, or self-employed individuals.
How much can I
contribute into a SEP?
You can only contribute 25% of your annual income. Each year the
IRS sets a limit on the total compensation amount that the employer
Are my SEP
contributions tax deductible?
Generally, the contributions you make each year into your SEP IRA
are tax deductible. If you are self-employed, you can deduct the
contributions you make each year to your own SEP IRA.
For more information:
The information provided here is not intended to be a
comprehensive discussion and is for general information only and
not intended to provide specific tax, legal, financial, or
accounting advice or recommendations. This basic information
regarding retirement accounts does not cover all possible tax
consequences or IRA rules and regulations. Please consult IRS
Publications 525, 575, and 590 for more information in regards to
IRS rules and regulations regarding retirement accounts.
Please consult your tax advisor about possible tax benefits and
consequences for opening, contributing to or withdrawing from a
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