macmanmike6100

Hopefully, more of you financial wizards out there can help the rest of us regarding <b>Roth IRAs</b>.

What kind of research should be done and where might the best places be to look?

<i>With this help, one day I'll be able to give back to the TFP Finance forum!</i>

Zander

My dad talked to me about them once, I think the best thing to do would be to talk to your broker/accountant/or public finance firm.

Bamrak

Hi again
One of the first places I found for very sound financial advise is Dave Ramsey. He has a syndicated radio show and has some very common sense stuff. He does not believe in debt, and has been a very big bard of making me understand anything financial. With any advise, he provides the reasoning behind it.
Anyway, On his website he has what are called ELP's which are endorsed local providers. He enlists local people in your area that are willing to take the time with you to sit down and TEACH you how to invest properly. Last year I used ours and it was a fabulous experience. Dave's Website is www.daveramsey.com.


Here's some quick bullet points on Roth's taken from http://www.bradenton.com/mld/bradent...ss/7629009.htm

If you are single and have adjusted gross income of $110,000 or more, or married with adjusted gross income of $160,000 or more, you are not eligible for the Roth IRA. But for about 95 percent of the working population, features of a Roth IRA include:

• Maximum annual deposit is $3,000 (or $3,500 if you are over 50) in 2003.

• Flexibility to combine a Roth account with other tax-deferred retirement accounts, such as a 401(k), SIMPLE IRA, SEP or TSA

• Earnings inside a Roth are generally not income taxed.

• No required minimum distributions when you reach Age 70½. Since the IRS can't tax the distributions, it doesn't require withdrawal at a given time. Your money can continue to grow tax-free until you need it.

Other Roth restrictions include possibility of paying income taxes or a 10 percent penalty, or both, if you take distributions less than five years after you establish your first Roth account or before you reach age 59½.

gonadman

I've found www.fidelity.com to be a good source for info

__________________
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BigBlueWrecking

Any place can start a Roth IRA if it makes sense. The hard part is picking the mutual funds. If you want to do it yourself, Yahoo Finance, MSNBC, or a million other websites can give you a good idea. If you would prefer to get the advice of a pro, you will have to pay some sort of sales load. I have no problem with these if they make sense. There are many loaded funds that outperformed the Vanguard 500 over a 5-10 year span, and I only look at net numbers.

The better wuestion is why a Roth? I know their are some benefits, but depending on your income level at a later date, the tax write off may mean more today than tax free growth.

gar1976

If you're expectinjg to step up in tax brackets in a future date, a roth can work wonders. You can essentially pay 10-15% taxes on the income and stuff it away for when, later, you're in a higher tax bracket.

Right now, roth and regular IRA would probably be fine either way, since congress and the pres are messing with the tax rates so much. Who knows where the rates will be in five years? Anything into retirement is a good thing, if you can afford it.

Also, you have until the due date of your return to contribute, so making contributions to a regular IRA now can reduce your 2003 tax bill if you've found some messy penalties and interest.

macmanmike6100

i am planning on getting into a higher tax bracket, but i've heard such good things about a roth, why would I want to go with a regular?

and bigblue, what do mean "the tax wrote off may mean more today than tax free growth"? thanks everybody!

BigBlueWrecking

If you are in a 28% tax bracket today, and a 15% tax bracket when you retire....the 28% you get from writing money off today going into a 401(k) or Traditional IRA may be a better deal.

A lot of it has to do with the timefram, the type of investments, the performance, and how you structure the disbursements. I am not saying Roth's aren't great, but too often they are labelled as some savior. Also, the 3K you put in that...you may be able to put in a retirement plan with a match depending on your employer.

Bamrak

But if it is invested well, he's going to be getting ~10-12% average for the course of the fund. I can't even fathom how a roth wouldn't be benificial when retirement comes.