Tax Refunds?... Ira?

[onlyemokid]

I'm doing my taxes online, it asks:



Are you interested in contributing to an Individual Retirement Account or have you made a contribution to an Individual Retirement Account for 2006?

An Individual Retirement Account (IRA) offers tax advantages to set aside money for your retirement. You may be able to reduce your income by the amount of your contributions. Alternatively, with the Roth IRA, your contributions can grow free of tax and are totally tax free when withdrawn at retirement.



Should I do this? and whut other steps do I need to take once I accept this? Thx!

[lordsmurf]

I've had an IRA since I was 19 years old. I've had a 401k off and on since then too. The earlier you start saving, the richer you'll be. Just remember at your young age, do aggressive and moderate growth mutual funds, don't mess with "safe" funds.

I suggest a Roth IRA.

Remember you investment into the IRA cannot exceed your taxable income for the year. And the Roth IRA has a $4000 max per year.

[MagnificentMarcus]

The Roth IRA is funded with after tax dollars, which means no deduction on your taxes. The advantage is that the proceeds nor any of capital gains will be taxed when you begin withdrawing them after you turn 59 1/2.

If you haven't set the money aside already in a qualified financial instrument you will have to do so by the time you file your taxes or by April 15, 2007 to take the deduction on your tax return. Regardless of which option you choose.

[onlyemokid]

I'm not sure how I'm supposed to do it? becuase I'm only getting back 184$ and 64$ ....

[lordsmurf]

You get a financial company. This is not something the government does. Check into Janus for a company I suggest. https://ww3.janus.com/Janus/Retail/InvestWithJanus

[rockettj1225]

Go with a ROTH IRA if it is available to you. I have both kinds and the ROTH is much more beneficial. You are able to deposit funds into a ROTH IRA every year as long as it is before April 15 but it must be claimed on your taxes. The government does have a limit set of what you are allowed to deposit and it has changed recently (they allow more). It is the only IRA that allows you to contribute to it yearly and you do not have to pay taxes when it comes time to withdrawal it because you already paid the taxes on the money. A regular IRA you can must pay taxes on when it is withdrawaled and you can only contribute to it when it comes due (before renewing). Go to a bank and ask for a sheet that has all the details and qualifications for IRA's. It will give you an idea of how much you need to have to open each account. Vanguard is a good bank to use. Check it out at https://flagship.vanguard.com/VGApp/...mepageOverview

[lordsmurf]

Yeah, I've got some Vanguard funds through my 401k. American Funds are good too. And Fidelity.

[MagnificentMarcus]

Right guys, he has $228.00 and it is a one time deposit! I doubt they will set up account with a minimum like that.

[lordsmurf]

Yeah.... you usually need a $1000 to open an account. But call anyway. Some of them these days are competing really hard, with those $100 entry-level deals. These days, they take money however they can get it.

Look at this one: http://www.arielmutualfunds.com

quote:FAQ > Open an account >
Q: What is the minimum investment required to open an Ariel Mutual Funds account?
A: For regular accounts (non-IRA accounts), the minimum initial investment is $1,000 per fund. For IRA accounts, the minimum is $250 per fund. However, if you participate in an Automatic Investment Program, the initial investment for all types of accounts (Regular and IRA) is waived. If you select this option, you designate a certain amount (minimum of $50 per month) to be automatically deducted from your bank account or paycheck and invested in your Ariel account each month.

I don't have any experience with them, but Morningstar shows they've been around at least 20 years and their funds do decently (10%), and they survived the dot-bomb era pretty darned well too.

I'd swing the $250 and jump in. In future years, add more.

FYI: You can track funds here: www.morningstar.com

[rockettj1225]

Most Big banks usually need at least $1,000. The younger you start the better off you will be.

[rockettj1225]

this is something you should think about doing every year for about 10 years. This way when you retire you have a little bit of money. Also if your work ofters a 401K or 457 plan, get into it. Most of the time they will match so much of your money and from the start your making out. Plus, you get to play with the stock market there is well. Just a few thing to think about.

[rockettj1225]

here is a good site to check out http://www.highyieldfinder.com/ira.htm