When it comes to preparing for retirement, there is a good chance that you have not given a lot of thought to the amount of money you will need to live in order to enjoy life in your golden years. If you are just starting out in the work force, you probably think that you still have many years ahead of you, and you are having too much fun now to ruin it by thinking about your retirement. But the sooner you start planning the better, and an important part of the planning process includes choosing the right retirement investment option that will help you money grow. One of the more well known investment options comes in the form of a Traditional IRA.
One of the most attractive benefits of a Traditional IRA is that it gives investors the ability to deduct the entire amount of funds contributed in a given tax year from their taxable income. This benefit is commonly dependent on the age of the contributor and whether or not they are offered a 401K retirement plan at their place of work. Employees who are under the age of 70 and a half, and do not have a 401K plan, can deduct the entire contribution amount, which can be quite helpful during tax time. Those who have a 401K plan at work can still deduct a portion of their contributions from their taxable income, provided they are single and earn less than $69,000 a year, or married and combined earn less than $115,000 a year. To know more, just visit http://www.ira-to-gold.com/.
Another advantage of this type of investment retirement account is that is helps to decrease the amount of income that the contributor has to pay on their salary each pay period. Since contributions are made to a Traditional IRA with before tax income, the withdrawal is completed before federal, state, and other taxes are calculated, resulting in a smaller gross income amount on which taxes are calculated.
Lastly, funds that are placed in a traditional retirement account are not accessible by creditors. For example you have fallen on tough financial times and you have bills you are unable to pay, creditors cannot go after the funds you have placed in a traditional IRA as a means to paying off a particular debt that you owe. These funds are also kept secure should you find yourself in a tough financial situation where bankruptcy is the only option. Traditional IRAs are exempt from the bankruptcy process, allowing you to keep these funds even after all your debts have been wiped out.
These are just a few of the top benefits to choosing a Traditional IRA retirement investment account. While some may be eligible to deduct all their contributions on their yearly taxes, all contributions help plan owners to pay less in income taxes each year, allowing them to safely and easily save the money they will need in order to enjoy a stress free lifestyle in the future.