What kind of interest does a Roth IRA (bonds, mutual funds, invest)
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What kind of interest deos a Roth IRA generate today?
If I open one, with lets say 100K, what kind of interest will it
generate?
An average figure.
Really curious.
Thanks everyone.
What kind of interest deos a Roth IRA generate today?
If I open one, with lets say 100K, what kind of interest will it
generate?
An average figure.
Really curious.
Thanks everyone.
A Roth IRA is NOT an investment in and of itself. All it is is a tax shelter. You're making a deal with the government and saying "I'm going to put this pot of money away for my old age (and not touch it until then) and in exchange the government will give me a tax break".
You can designate many different types of investments as your ROTH IRA. Anything from individual stocks and bonds, to mutual funds that invest in stocks and bonds, to savings accounts and CDs, and even real estate (although I hear that's a bit complicated).
You don't open a Roth with $100,000. There is a maximum annual amount that you can contribute to a Roth and there are also income limitations. Presently, the maximum amount you can contribute is either $5,500 or $6,500, depending upon your age. You don't get to play catch up for years that you missed.
There are exceptions for rolling over other retirement accounts into a Roth, but those are a little more complicated. If you are starting from scratch, you have to abide by the limitations above.
You don't open a Roth with $100,000. There is a maximum annual amount that you can contribute to a Roth and there are also income limitations. Presently, the maximum amount you can contribute is either $5,500 or $6,500, depending upon your age. You don't get to play catch up for years that you missed.
There are exceptions for rolling over other retirement accounts into a Roth, but those are a little more complicated. If you are starting from scratch, you have to abide by the limitations above.
Yes, good point, I missed the part about having 100K to invest.
A Roth IRA does not generate any rate of return at all. 0%
It's a government sponsored program where the Roth part means you take after-tax money today and invest it in something and then when you retire you withdraw that without any taxes (opposite of a traditional, or regular IRA).
Limit this year is 5500 (pending some annual income limits).
Usually you can open a Roth IRA with many different companies. I would recommend something like Vanguard...very low, passive index funds that is in it for the long-haul.
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