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I'm starting a new job soon and would like to set up an IRA. I currently do not have any retirement and I am 36. Should I just set one up through my bank? My new job does not offer any type of retirement. Please help me. I know nothing about this stuff!
An IRA is like a basket. Its what you put in it that counts. You can put in it mutual funds, stocks, cash. I would recommend opening a ROTH Ira. I have one that I opened around your age, and all my withdrawals now are tax free. Nice.
Maybe go to Fidelity and let them help you open your IRA. Then you can buy some good dividend paying stocks, especially now since the market is down. Set them to reinvest into themselves, and watch your dividend income grow....tax free.
An IRA is like a basket. Its what you put in it that counts. You can put in it mutual funds, stocks, cash. I would recommend opening a ROTH Ira. I have one that I opened around your age, and all my withdrawals now are tax free. Nice.
Maybe go to Fidelity and let them help you open your IRA. Then you can buy some good dividend paying stocks, especially now since the market is down. Set them to reinvest into themselves, and watch your dividend income grow....tax free.
What is the difference between a Roth and Traditional?
My opinion is that banks are expensive and I would not use one.
Look for an on line broker or mutual fund. Vanguard, E*Trade, Charles Schwab and Fidelity are places to look.
You should be able to complete the account on line and send in a check for your deposit. If you have problem call customer service.
A traditional IRA gives you a tax deduction today for the money you put in but taxes all the money you take out at retirement.
The Roth does not give you a tax break on the money you put in but does not tax anything you take out.
I would go with the ROTH.
As mentioned the account is a holder. Next you have to pick the investment to put in. You will find a lot of education on the sites I mentioned.
If you had earned income this year you can put money in now. If not then you could open now but sent the money in 2019 and be sure to note that it is a 2019 deposit.
I use vanguard and really like it. If you buy and sell vanguard based ETF's there are no commissions charged, very low fees.
Someone in finance once told me "if you qualify for a Roth chances are it's your best option"... So without putting too much thought into it I'd go Roth.
Another idea, open an automatic saving/investing account. I just started using Acorns and love it! It automatically rounds up your purchases and automatically invests it. So if you by lunch for $6.25 it'll round up to $7.00 and put that extra $.75 into the acorns account which is then automatically invested! https://www.acorns.com/invite/RWH4MC
I'm curious as to why so many are recommending the Roth without asking any additional questions of the OP. For me, I don't think the Roth would be a better deal, because I make a fairly high salary. I'm probably going to be in a lower tax bracket when I retire, so why would I want to pay higher taxes on the money right now? I also only spend about half of my income right now, and will probably continue living the same lifestyle in retirement, so, again, my income will likely be much lower during retirement than it is now, which means I should be paying less income tax during retirement than I do now.
I'm curious as to why so many are recommending the Roth without asking any additional questions of the OP. For me, I don't think the Roth would be a better deal, because I make a fairly high salary. I'm probably going to be in a lower tax bracket when I retire, so why would I want to pay higher taxes on the money right now? I also only spend about half of my income right now, and will probably continue living the same lifestyle in retirement, so, again, my income will likely be much lower during retirement than it is now, which means I should be paying less income tax during retirement than I do now.
Excellent point. Also, I would certainly be sure I was on track to have my 0% and 10% tax brackets full before I focused on my Roth.
I'm curious as to why so many are recommending the Roth without asking any additional questions of the OP. For me, I don't think the Roth would be a better deal, because I make a fairly high salary. I'm probably going to be in a lower tax bracket when I retire, so why would I want to pay higher taxes on the money right now? I also only spend about half of my income right now, and will probably continue living the same lifestyle in retirement, so, again, my income will likely be much lower during retirement than it is now, which means I should be paying less income tax during retirement than I do now.
The ROTH is very good for lower income individuals.
For higher earners it could vary and I would want a mix of both regular and ROTH.
Look at your income with the RMD's. Your income maybe higher than you think.
Lets say 20 years ago you purchased Amazon at $10. Say you got a $2 tax deduction. You sell it and take the proceeds from your IRA. Say 1,000. Taxes 200. The numbers are made up but a life time of tax free earnings has some value.
You are correct that a lot of information is not generally in the posts and we all make assumptions. For example the assumption that a regular IRA is better than a ROTH for the individual. You are also missing the same facts we are so who know who is correct?
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You need to educate yourself
