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-   -   Need help with first time IRA (https://www.early-retirement.org/forums/f28/need-help-with-first-time-ira-19299.html)

danm 01-21-2006 10:36 AM

Need help with first time IRA
 
Hi,
I need some advice. My wife doesn't work, and I have a employer sponsered 401k, with the bulk of my capital in after tax investing. I'm almost 40, and have a high salary. I think I'll set up an IRA for the first time this year. I see two options

1) Do $8k in two Roth's for both me and my wife.
2) Do a traditional $4k for my wife

I'm leaning towards the $8k, so we can dump more in. I understand the Roth is with post tax dollars. Thoughts?

cute fuzzy bunny 01-21-2006 11:16 AM

Re: Need help with first time IRA
 
Without other info, the roths are a no-brainer.

With other info, like when you're planning to retire, what other assets you have, what your marginal tax rate is, and so forth, maybe a different answer. Probably not though.

Martha 01-21-2006 11:24 AM

Re: Need help with first time IRA
 
Quote:

Originally Posted by danm
I'm almost 40, and have a high salary.

How high is the salary? Are you even eligible for the Roth? It phases out for joint filers for AGI starting at $150,000 and is gone at $160,000. Your income will also effect whether you can deduct the spousal, traditional IRA.

TromboneAl 01-21-2006 01:44 PM

Re: Need help with first time IRA
 
There are calculators out there to help you decide on Roth vs. Trad, like this one.

aaronc879 01-21-2006 04:03 PM

Re: Need help with first time IRA
 
You said your wife doesn't work. I think she needs earned income to contribute to an ira.

retire@40 01-21-2006 04:40 PM

Re: Need help with first time IRA
 
Quote:

Originally Posted by aaronc879
You said your wife doesn't work. I think she needs earned income to contribute to an ira.

You think wrong, grasshopper.


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