Looking forward to 2017 you should review your retirement plans to determine what changes, if any, you want to make. Individual retirement plans (IRAs and 401(k)s) are two of the most common defined contribution plans and offer tax-advantaged retirement savings.
The annual limit for contributions for traditional and Roth IRAs for 2017 is $6,000. People age 50 or older in 2017 can contribute an additional $1,000 for a total potential contribution of $7,000.
The annual imit for contributions for 401(k), 403(b), and 457(b) plans is $18,000. Workers age 50 or older in 2017 are permitted an additional catch-up contribution of $6,000 for a total potential contribution of $24,000.
401(k) v. IRA:
- For employees of companies that offer such plans
- Employer may match the contribitions up to 6% of salary
- Pay taxes later (upon withdrawal during retirement)
- Individual Retirement Plan (IRA)
- Roth IRA
- Pay taxes now
- Tax-free withdrawals of contributions only (not earnings or interest on contributions) at any time
- Traditional IRA
- Pay taxes later
- Receive potential tax deductions now
- Roth IRA
Now, get to it . . .
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