<p>Don’t look! But I’ll bet they went way up today.</p>
<p>@dragonmom, I still need to invest some more; stock funds are on sale!!</p>
<p>As true as that is, stocks going down in the first few years of retirement is tough. </p>
<p>Ok… I have a Sep ira. For 2014, I want to open a roth and transfer some assets from the sep ira to a roth. I am going to file in october 2015 for the 2014 tax year. </p>
<p>Can I open a roth account anytime before I file in late 2015? </p>
<p>^ I believe the Roth conversion is reportable in the year it actually happens. IOW, for it to affect your 2014 taxes, it has to be done by December 31.</p>
<p>You can open the Roth up until April 15, 2015 and make contributions to it for 2014, but not conversions.</p>
<p>I am swearing now. Thanks.
Ok…I see I can unwind the conversion if I change my mind.</p>
<p>Good info notrichenough. </p>
<p>I have a question and I can’t go through 4k plus posts - hubby is now at that special age… ahem…where he qualifies for “make up” contributions on his 401k. Can anyone over 50 do this or is there some kind of qualifier?</p>
<p>I believe if you hit the age, you can contribute up to the make up max.</p>
<p>I agree…if you hit that age, you can make this increased contribution.</p>
<p>As long as you turn 50 during the calendar year you are making contributions for, you can make catch-up contributions in 401Ks, IRAs, and some other plans.</p>
<p>The amounts vary depending on the plan and some other things:</p>
<p><a href=“http://www.irs.gov/Retirement-Plans/Plan-Participant,-Employee/Retirement-Topics-Catch-Up-Contributions”>http://www.irs.gov/Retirement-Plans/Plan-Participant,-Employee/Retirement-Topics-Catch-Up-Contributions</a></p>
<p>The catchup amount is rising to $6000 for 401Ks for 2015, and the max is going up to $18000, for a total of $24000.</p>
<p>Anyone over 50. Actually, anyone the year they turn 50. You don’t have to wait till the following year. </p>
<p>No, I didn’t have to do anything special, just told the HR folks to put the higher amount into my 403b.
You don’t have to prove anything other than age over 50. </p>
<p>For example, if you are turning 50 in November 2015, you can elect the 6k catch up on January 1, 2015!</p>
I just discussed with my son about IRA. He said he can have both 401K and IRA. I never thought it’s possible to have both. Turbotax did not let me have that. Am I wrong? Also for young adults, should they maximize IRA or 401K contribution? Happy New Year to all!
As far as which to max out as a young adult, it depends. Always at least put in whatever the employer matches into the 401K first. I think the next thing people should do is max out the Roth, particularly if they are not high income and won’t get a big tax break for the 401K. Then put as much as they can into the 401K, as early as they can, in an index fund that has an excellent long term track record, that is fairly aggressive. At least that is my two cents!
And yes, you can have both a 401K and an IRA. He can put $5,500 into a Roth IRA for 2015, and up to 18K in a 401K for 2015. I only mention the Roth IRA because that is really the only type of non employer sponsored IRA he should be putting money into.
You can do both, but if you have a 401k then the IRA cannot be a deductible one, in which case you might as well do a Roth as busdriver suggests.
You can have a 401K and an IRA. If you do a nondeductible IRA and don’t have any other IRAs, you can do a backdoor ROTH IRA, which is what our S is doing. He is also employed, so he participates in a ROTH 401/403 plan with his employer.
For 2014, the max an employee can contribute over 401K and 403K accounts is $17,500. It goes up another $500 next year for the max employee contribution and an additional $5000/year catchup if you’re turning 50 (or older) in any year.
The employer contribution can be up to 20% of the net profit, I believe. The employer portion can be deducted as a business expense.
I see now. Thanks.
If the employee earns less than the income cap, she can do a regular Roth IRA, I believe.
If you do an IRA and a 401K, you can’t put in more than your total income.
Well, I “retired”. I told my boss I was giving 6 weeks notice and retiring. They came back and asked me to work part time. We had some back and forth, and the bottom line is I’ll be working a couple of days a week. I don’t have to abandon all my clients, and I get time off to follow my own interests.
I think this is the best of both worlds. The extra money will make it a lot easier to persuade my H to keep taking vacations. Win!