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Wisdom to Wealth- Monday, March 1

Published: Mar. 1, 2021 at 6:03 PM EST
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John Halterman: Did you know that you can still make contributions for tax year 2020 into an IRA? The key though, is you have to make it by April 15th and you have to say this is for the year 2020. The second key is you gotta decide, should I be putting into a traditional IRA or a Roth IRA. In a traditional IRA, you’re going to get a tax deduction up front. The money is going to grow tax-deferred, but in the end it’s taxable as ordinary income thru distributions and through inheritance. Whereas in the Roth IRA, you do not get an upfront tax deduction. The money is going to grow tax-deferred, but then, when you take it out in retirement or pass it along as inheritance, it’s one-hundred percent tax-free. And so, you gotta decide, would you rather get a tax deduction today or tax-free down the road. For more answers, call or visit our website today.

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