​How To Start A Retirement Fund – 401 Or IRA?

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March 28, 2013

How To Start A Retirement Fund – Learning how to start an early retirement fund can be complicated. If your employer offers a program and will match your contributions, that should be the first place to begin. However, most of them don’t, and most people don’t know where to turn to to open an IRA.

Here are some tips on how to start a retirement fund of your own. Almost anyone with some earned income can contribute to an IRA. There are some limitations on how much you may be able to deduct from your taxable income, but those limitations usually won’t affect you unless your income is fairly high.

It’s not hard to open an IRA. Almost any bank or investment firm will help you open one. You will need to decide whether to choose a Traditional IRA or a Roth IRA. A Traditional IRA can provide you with an immediate tax break. The Roth IRA will provide you will a tax break when you are withdrawing from the account during retirement.

Both the Roth and the Traditional IRA have limits on how much you can contribute each year. You will be allowed to contribute a little extra if you are 50 or over. However, if you haven’t already started building your retirement plan and you are nearing your retirement, you may want to research using more than one type of account.