2007-05-14 16:55:45 · 7 answers · asked by imrbilly 1 in Business & Finance ➔ Personal Finance
i have a 457 tax-deferred plan with my employer...think i should open a roth ira on the side anyway?
2007-05-14 17:10:52 · update #1
You should definitly have a Roth as part of your retirement planning. Your employer sponsored plan is tax deferred--meaning you will pay taxes on your savings before you can ever withdraw them. But a Roth IRA is tax exempt; you'll never pay taxes on your gains. It's great to have both types of accounts, since you never know what tax rates will be when you retire.
Plus, you can put any investments you choose into your Roth. And you can take your contributions back out any time for any reason with no penalty.
The best time to open one is as soon as you can. If you invest each year on January 1, your savings will have all year to grow. The sooner the better.
2007-05-14 17:32:44 · answer #1 · answered by lizzgeorge 4 · 0⤊ 0⤋
I would say the beginning of the year, or as soon as possible. Why not? You will earn interest all year then. Unless you are already holding your money in a high interest yielding account, I say start up your Roth immediately, whatever you can afford, the sooner the better. If you can get a 401K at work, take advantage of at least whatever your employer can match before contributing to a new IRA.
2007-05-14 17:01:41 · answer #2 · answered by Anonymous · 1⤊ 0⤋
You should have opened one just before fileing your 2006 taxes, then you could have taken the tax advantages for your 2006 taxes. Now is the time to open one for 2007. The sooner the better. Roth is the best.
2007-05-14 17:00:14 · answer #3 · answered by Diane 2 · 1⤊ 0⤋
putting money into a Roth at the first of the tax year allows you to earn money on that investment all year. If you make your 2007 contribution next year, you don't get all the earnings it would have made this year. So to answer your question,, as early in the year as you can is best.
(just be sure you will earn enough to contribute)
2007-05-14 17:48:57 · answer #4 · answered by Jo Blo 6 · 0⤊ 0⤋
Hey Diane, there are no tax advantages to be had. If you haven't got a Roth the best time to open one is A.S.A.P. Great tool. I say don't overinvest for retirement. But not a bad idea to have your own self directed account.
2007-05-15 04:38:09 · answer #5 · answered by Big R 6 · 0⤊ 0⤋
January 1 is the best time so that your money can go to work and work for as long as possible.
2007-05-15 02:54:12 · answer #6 · answered by derek 4 · 0⤊ 0⤋
best time to open up an IRA is ASAP--the sooner you open it, the more tax-free investment gains you can get.
2007-05-15 00:09:22 · answer #7 · answered by njyogibear 7 · 0⤊ 0⤋