how should i go about getting an IRA.?

Question

I want to start planning for my future and i heard that a Roth IRA is a good way to start but i want the pros and cons first.

Answer 1

You can go anywhere and open one up in a matter of minutes. I did at Fidelity Investments recently.

The difference between an Ira and a Roth Ira is that the IRA you get a deduction on your tax return, but if you take any money out before you retire, you have to pay taxes on it.

In a roth Ira, you do not get a tax deduction but if you need to take money out before you retire you will not be taxed.

I went with the roth, just in case.

Answer 2

With a Roth IRA, you save after-tax dollars. But the earnings are tax free. When you start to make withdrawals, you don't pay any taxes.
With a conventional IRA, both the amount you put into savings and the earnings are tax-deferred until you begin to withdraw the money, after age 59 1/2. Then everything is taxed at your effective tax rate.
I cannot say which is better for an individual. I set up a conventional IRA and began withdrawing money at age 59 1/2. My effective tax rate, last year, was 9%. So I am paying 9% tax on money that would have been taxed at 35%, without an IRA, when I was working. It seems like a good deal.

Answer 3

Without knowing your personal circumstances and financial details (and I wouldn't expect you to post them here!) it is difficult to say whether a Roth IRA is the best place for you to put your money. Look at the IRS's website for the details and rules regarding different IRAs. You can get IRAs at numerous financial institutions, eg: Banks. They are falling over themselves to get your money!

Answer 4

Consult a financial planner. Find one that does not charge for their services. They will get paid by the company they work for.