I would like to contribute to a program like a 401(k) after maxing out my contributions?

Question

I am limited by my company from adding contributions to my 401(k). I would like to put more in to something similar--is there something comparable that I can use? I use my regular investment account but would like something with tax incentives.

Answer 1

If you fall under the income limits you can look into a Roth IRA, after tax dollars grow tax-free,I believe the annual limit is about $4000. Though there are no-tax savings now, in the long run the savings in tax are tremendous.

For immediate tax-savings there are funds that are very tax friendly and of course municipal bonds however the rates of return are smaller than a comparable taxable account so it;s only beneficial for those in higher tax brackets.

Answer 2

In any case, regardless of your tax situation, you can start either a traditional IRA or a Roth IRA. Whether or not you'll have to pay income tax on the money you deposit depends on your individual situations. Roth IRA's have a potential to allow you to pay the tax on the front end as opposed to back end. Due to the inflationary policies of the US government, it might make more sense to pay the tax on the back end (when you retire) with dollars that are worth less and keep your dollars today. If you want to go that route, a traditional IRA would be more suited for you. In either case, a tax advisor can tell you how much, if anything, you'll owe in tax.

Hope this helps!

Answer 3

Open the Roth IRA

Answer 4

IRA account. If you max that out too you can look into variable insurance.