Individual Retirement Plans

For individuals not currently participating in a company-sponsored retirement plan, there are limited solutions for retirement planning. These programs are subject to income limitations, which we are happy to discuss with you.

Traditional IRA

A tax deductible retirement plan set up with a financial institution or brokerage, where you can contribute personally or via payroll deduction. The annual contribution limit for 2020 per indiviual is $6,000, or $7,000 if you’re age 50 or older.

Tax Benefits: Contributions are Tax Deductible and Investment Earnings accumulate Tax-Deferred, and you don’t pay taxes until a withdrawal is made.

Note: There are restrictions to your Tax Deductible Contributions if you,or your spouse, are covered by an employer-sponsored plan and limits based upon total earnings.

Roth IRA

Roth IRAs are a special type of Individual Retirement Account that you may qualify for based on your income level. The annual contribution limit for 2020 per indiviual is $6,000, or $7,000 if you’re age 50 or older. It is not tax deductible, but distributions are tax-free when you follow the rules, and you can tap your contributions (but not your earnings) any time tax-free and penalty-free.

Individuals who expect their tax rate to be higher during retirement than it is now may benefit from a Roth IRA, making them ideal savings vehicles for young, lower-income workers who won’t miss the upfront tax deduction, but will benefit from decades of tax-free, compounded growth.

Tax Benefits: Investment Earnings accumulate Tax-Deferred, and you don’t pay taxes when a withdrawal is made.

HSA – Health SAVINGS ACCOUNT IRA

If you or your employer participate in a qualified high deductible health plan (HDHP), you and your family are eligible to make tax deductible contributions and enjoy triple tax saving – tax free going in, tax free while they grow and tax free when the investments are dispersed, by establishing your own Health Savings Account IRA in the amount of $3,550 to $9,100 per year depending on your plan. Funds are tax-deferred, and can be withdrawn tax free to reimburse you and your family members for your out of pocket medical, dental, orthodontic, and optical expenses. For a more information on this important government-approved benefit, visit our detailed HSA information.

Michael G. Kirwan, CLU, ChFC is an Independent Advisor Representative (IAR) of American Portfolios. Securities offered through American Portfolios, member FINRA & SIPC. 631-439-4600.
The Kirwan Companies, Ltd, and American Portfolios are separate and unrelated entities. Check our broker status.

 

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