With a new year ahead, many people think that it’s too late to contribute to a retirement account and take advantage of tax-advantaged potential earnings. However, there is still time to contribute for 2017 until the tax deadline—which this year falls on Tuesday, April 17 thanks to April 15 being a Sunday and Emancipation Day in the District of Columbia falling on Monday, April 16. The Individual Retirement Account (IRA) contribution limit for both 2017 and 2018 is $5,500, plus an extra $1,000 if you are 50 or older.
If you are eligible to contribute, your contribution can be to a traditional IRA or a Roth IRA, or split between the two, as long as the total contribution fits into the annual contribution limit. Now that it’s tax season, it’s worth consulting an accountant or other tax expert to see how contributing to an IRA will affect your tax liability.
People are living longer, so the years of retirement will likely be longer. Without the proper savings, investing, and planning, many people will not feel comfortable in trying to reach their goals. Some people even have nothing saved or planned for retirement. Hopefully, you are not waiting until the last minute to act. Be proactive!
Regardless of the amounts, it’s a smart strategy to start as early as you can with however much you can contribute. The power of compounding over time with savings and investing is extremely compelling. It’s not too late!
Did you know? If you have an idea that you would like explored in a future tip of the week, or if you would like more information on something that has not been discussed for your personal situation, then please feel free call us at 855-471-5796 for assistance. The goal is to empower yourself, and the more details that you have, the more prepared you will be.