CD, IRA, OR 401(k)?Q A Since there won't be any social security by the time I'll be of age to collect it what would be the best vehicle to invest in for the next 40 years--an IRA Ira, in the Bible Ira (ī`rə), in the Bible. 1 Chief officer of David. 2, 3 Two of David's guard. IRA, abbreviation IRA. , CD, or 401(k)? --D. Williams Via the Internet Internet Publicly accessible computer network connecting many smaller networks from around the world. It grew out of a U.S. Defense Department program called ARPANET (Advanced Research Projects Agency Network), established in 1969 with connections between computers at the Since you are talking about investing over a 40-year period, you should look at using both a 401(14) and an IRA for retirement. If a 401(k) is offered at your job, enroll in it and invest as much as you can, saving a percentage of your pre-tax income each pay period--up to $15,000 for 2006. And if your company matches employee contributions, you'll save that much more money. If you leave your company, you can roll over your 401(k) into a traditional IRA Traditional IRA An IRA that is not a Roth IRA or a SIMPLE IRA. Individual taxpayers are allowed to contribute 100% of compensation (Self-employment income for Sole proprietors and partners) up to a specified maximum dollar amount to their Traditional IRA. account, which will allow you to continue earning interest tax-deferred until you withdraw the funds in retirement. Once you get to where you can contribute the maximum amount to your 401(k)and you have additional income to save, look to open a Roth IRA Roth IRA An individual retirement plan that bears many similarities to the Traditional IRA. Contributions are never deductible, and qualified distributions are tax-free. A qualified distribution is one that is taken at least five years after the taxpayer established his/her first . You can also turn to a Roth IRA if your employer doesn't offer a 401(k). A Roth IRA allows you to save after-tax income toward retirement and withdraw tax-free in retirement. A certificate of deposit is not the best choice for someone with more than 40 years to invest. CDs are fixed-rate investment vehicles that won't give you a very high investment return over time. While a CD would allow you to keep your principal investment, you would miss out on opportunities to earn higher returns from the stock market investments available through the 401(k) and IRA options. Mail your money management questions to Ask Money Hatters, BLACK ENTERPRISE 130 Fifth Ave AVE Avenue AVE Average AVE Alta Velocidad Espanola (train between Madrid and Seville) AVE Alta Velocidad Española (Spanish: High Speed Train) AVE Audio Video Entertainment AVE Advertising Value Equivalent .. New York New York, state, United States New York, Middle Atlantic state of the United States. It is bordered by Vermont, Massachusetts, Connecticut, and the Atlantic Ocean (E), New Jersey and Pennsylvania (S), Lakes Erie and Ontario and the Canadian province of , NY 10011 or send an e-mail to scottm@blackenterprise.com. |
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