Retirement Planning

Traditional, Roth, and rollover IRAs each have their own advantages as well as certain restrictions. While traditional IRAs often allow tax-deductible contributions and offer tax-deferred earnings, Roth IRAs are funded with after-tax dollars and allow earnings to be withdrawn tax free after age 59^1/2, provided the account has been open for at least five years. Both allow annual contributions of $6,000 ($7,000 if 50 or older) and make available a broad range of investment vehicle choices.

Plus, both traditional and Roth IRAs offer a certain degree of flexibility in case you need to interrupt your savings for specified expenses, such as purchasing a first home or funding a child's education. Roth IRAs must be open for at least five years prior to withdrawals begin taken, and normal tax rates will apply for withdrawals from traditional IRAs.* 

A more specialized option, rollover accounts are used strictly to convert funds from qualified retirement or pension plans without assuming current tax liability. With so many choices, choosing the right IRA for your needs takes careful research and consideration.

Whether it's a simplified employee pension (SEP) or savings incentive match plan for employees (SIMPLE) IRA, a 401(k), 403(b), or a defined benefit plan, many employers offer a qualified retirement plan. Contributing to these plans can be a great way to set aside pre-tax dollars for retirement. Even if you're the sole proprietor in your own business, an Individual(k) is a cost-effective 401(k)/profit sharing plan for small business owners that may be a useful way to save for the future while taking advantage of tax benefits today.

Although you may not have a choice about the type of retirement plan your employer offers, you can choose whether or not to invest in these plans and how to do so. Each plan has a range of investment options and distribution considerations to keep in mind when choosing the right plan for you. Because selecting the proper investments, wisely allocating your assets, making decisions about withdrawals and required minimum distributions, and choosing what to do with plan assets when you change jobs can be daunting, consider undertaking these tasks with professional guidance.

A broad array of additional investment products are also available to you, such as mutual funds, annuities, individual stocks and bonds, or separately managed accounts from independent money managers. These may be used to provide additional balance and goal-specific options to your retirement plans.

Your financial consultant can offer guidance on potential benefits and limitations of the choices available to fit your circumstances.