• Should You Go The Roth IRA Investing Route
    • By: GORDON HALL

      Today I would like to talk about rolling over your current employer plan into a self directing Roth IRA. Why, you may ask? Because you can convert tax deferred future income into tax free growth. While the employer plan ie your 401(k) will attract tax when you roll it over, It does provide you with a means of funding your self directing Roth IRA, other than the annual contribution of $5000,00 plus the $1000,00 you can put in per year as a catch up when you turn 50years of age. And you have the added advantage of paying no tax when you withdraw it in your retirement. You have to meet certain income requirements, ie you must have an income that is no more than $100,000.00 per year or less.

      I will tell you a little story. A couple had just bought a nice house in a lovely area using their traditional IRA, but shortly after buying the house the wife decided she wanted to live in it when they retired. However if they did that it would have been classed as a prohibited transaction and they would have been heavily penalized and taxed just when they needed the money the most, ie for their retirement. The husband gave in to his wifes wishes and consulted their IRA custodian. The custodian told them to transfer their IRA over to a self directed Roth IRA. They would have to pay tax on the assets they were rolling over, but they would be taxed at todays values. When they retired the assets in their self directed Roth IRA account would be tax free. As such they could move into their house without penalties, and it would all be legal. The couple are looking forward to a happy retirement.

      For those people planning on working well beyond the normal retirement age, you would be wise to consider rolling over to a self directed Roth IRA, as you can make non deductible Roth IRA contributions after the age of seventy and one half years of age. But you must be earning income at least equal to the contribution amount. If you do not think you will need any of your IRA assets, a Roth IRA will allow you to bequeath more to your heirs, because it is not mandatory to take distribution at seventy and one half years of age. Plus the Roth IRA will continue to grow tax free in your heirs hands, although they are required to take distributions.

      I hope this has been helpful to you all. If you think this is too hard or you can not be bothered, there is a simpler more TURNKEY solution to your needs. Just go to the url at the foot of this article and proceed to my website, there you will find more information on IRAs and real estate.

      Gordon Hall is an ardent reviewer of IRAs and other retirement funds. Visit his website now at http://www.double-your-ira.com to discover which retirement funds Gordon recommends after far ranging and extensive comparisons.