Currently my hubby and I are saving the majority of our $ in a traditional IRA. We understand that we can pull this $ out without a penalty, but we know that we'll have to pay taxes on it. Would our money be better off somewhere else or is this the right way to go about saving to buy a house?
2007-03-21 19:17:10 · 2 answers · asked by Jessica R 2 in Business & Finance ➔ Renting & Real Estate
Roth IRAs are less restrictive when it comes to penalties for premature withdrawals as long as you only take out as much as you contributed [withdrawing accrued earnings from investments is taxable, though there are exceptions such as if you're using the money for educational expenses or buying a first home which sounds like what you're looking for]. I've been contributing to a Roth IRA since I was 19, and unless they overhaul the rules [a possibility, unfortunately] it was definitely the right choice. There are some restrictions [such as income limits]; you can find more information about the features of this type of account in the source link.
2007-03-21 19:35:40 · answer #1 · answered by melis 3 · 0⤊ 0⤋
That is a decent place to put it because it is safe and tax free.
2007-03-24 06:34:51 · answer #2 · answered by Santa Barbara 7 · 0⤊ 0⤋