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Greetings!
We hope you find our April newsletter enjoyable and informative. |
New Math for IRA Savings
The (surprisingly) little-used Roth IRA could be the best option for many people approaching retirement.
Usually, the last thing anyone giving financial advice needs to do is to tell Americans to dodge taxes. Tax our tea unfairly and we'll start a revolution. Give us a holiday from sales tax and we'll buy all kinds of clothes and appliances we don't need. Launch single-state muni-bond funds whose yields are exempt from income taxes in jurisdictions that don't even have income taxes and we'll plow our money into them. (Seriously, why does the Nuveen Texas Quality Income Municpal fund even exist?)
Yet there's a way to completely avoid paying taxes on retirement savings, and it's perplexingly unpopular. With a Roth IRA, your retirement investments grow tax free. If you get a statement showing you have $200,000 in a Roth IRA, that amount--and not some lesser figure you have to guesstimate after trying to adjust for taxes--is what you've got, and you can spend it whenever and however you please. But just 19 percent of working Americans have Roth IRAs, even though 90 percent are eligible for them, according to Fidelity.
This tax season happens to be a particularly good time to get your household's savings into a Roth IRA.
(To read entire article please visit www.zinio.com and click on "Create An Account"; Zinio offers a service to subscribe to digital magazines online).
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