fwuser12 said: rustum said: fwuser12 said: rustum said: fwuser12 said: rustum said: Is there any income limits for spouse IRA contribution? I am contributing to 401k with company. Spouse doesn't do any 401k contribution.
In short, deductibility of spouse's IRA contribution will depend on your being covered by a retirement plan at work. Thanks again. Spouse did not opt for 401k contribution through her office considering there is no match. It should come under spouse who is not covered by plan at work right? I quickly checked our forms. Our total of Line 1 is less than 180k. There is no other incomes. So, we should be good either way right? I am planning to contribute $5500 to her existing IRA account.
Thanks This is what it says in the top of the page: "Effect of Modified AGI on Deductible Contributions if You are NOT Covered by a Retirement Plan at Work" YOU = rustum's spouse (who is not covered by a retirement plan at work) Third row of the table says: "married filing jointly with a spouse who is covered by a plan at work" rustum's spouse is filing MFJ with a spouse (rustum) who is covered by a plan at work
So the limit for your situation is 184k for full deduction. ETA: Line 37 in form 1040 is your AGI. You need to get your MAGI from that to compare with 184k. Not line 1 as you mentioned. Thanks again fwuser. My only confusion was if we are part of "is covered by a plan at work" or "is not covered by a plan at work" considering there is no match at spouse work place. Either way, we are going to be qualified. Thanks again for patiently explaining details.
rustum said: Thanks again fwuser. My only confusion was if we are part of "is covered by a plan at work" or "is not covered by a plan at work" considering there is no match at spouse work place. Either way, we are going to be qualified. Thanks again for patiently explaining details.
Remember, retirement plans are always individual. Although you file MFJ, each one of you has an individual IRA and/or 401k. Each ones contribution maybe deductible (or not).
To determine whether your contribution can be deductibel, you go with the chart that says on top "covered by a plan at work"; for your spouse the chart must be the one that says "not covered" on top. Then you look at the corresponding row of the chart that talks about the respective spouse being covered (or not) by a plan.
rustum said: Thanks again fwuser. My only confusion was if we are part of "is covered by a plan at work" or "is not covered by a plan at work" considering there is no match at spouse work place. Either way, we are going to be qualified. Thanks again for patiently explaining details. While the IRS uses the term "covered" is some places, what matters is if you are an "Active Participant". Which is even more confusing, because you do not have to make a contribution to be an active participant.
An Active Participant is someone who either makes a contribution or on whose behalf a contribution is made. If the company makes a non-elective contribution (this is not a match) on your behalf, then you are an active participant. Also, in very rare situations a company may make a pro-rata contribution of forfeited contributions when employees terminate before those contributions are vested.
Just switched jobs, want to know how I should handle my 401K.
I assumed that the 401K had the lowest fee’s, since it’s negotiated with a large company. As I talk to Financial Managers they tell me 401K’s have a higher fee, but I would expect them to say that as they want me to switch.
Here is my current condition
Account A - Have 100,000K managed by a manager. Fee is 1%. I started with him on 2/2014. Note 2015 was a bad year. 1. Total return since inception has been 1.14%. 2. Annualized return is 0.53%. 3. YTD return is 0.46 Account B - Have 100,00K in T Rowe Price Started on 6/2009. This is my former company’s 401K Plan. 1. Total return is 11.2%. 2. Annualized return is 1.6%. 3. YTD return is 1.25%
I am concerned my Account A seems to be under performing my Account B. But my focus is on Account B first and I am looking at the following options: 1. Do nothing. Keep Account A and Account B, will start new Account C with my new employer 2. Move Account B to to my new employer’s 401K. I checked and this is allowed 3. Move Account B to a new IRA, that I manage myself.
I am leaning towards, option 3. Wanted to get opinions on this.
westcoastbeginner said: I assumed that the 401K had the lowest fee’sThere's no need to assume, the fees should be disclosed either right on the website or in the investment disclosure brochures. If you have lots of fund choices, you'll be better off with funds that charge less (aim for 0.10%). westcoastbeginner said: As I talk to Financial ManagersWhat's a Financial Manager? You are probably right, they don't have your best interest at heart. If you are going to speak to anyone at all, you should probably speak to a fee-only Registered Financial Advisor or a CFP. Anyone else is just pretending. westcoastbeginner said: Account A - Have 100,000K managed by a manager. Fee is 1%.What a racket. You're paying him $1000/yr for doing something you can easily do yourself. Plus he probably gets a kickback from whatever funds he invests in, so you're getting doubly screwed. Read Lazy Portfolios. You can also look into robo advisors like Wisebanyan, Betterment, Wealthfront, or FutureAdvisor for advice or to manage your accounts for much less than your current "manager" charges. The jury is still out on the robots, and I think they're only worth it for taxable accounts, not for tax-deferred retirement accounts.
nwill002 said: I am changing jobs and going public sector and plan to roll my 401K into the 457b offered at my new job. Is there any reason why I may not want to do this and perhaps put it into an IRA instead? I suppose that depends on what the investment choices are for the 457b plan as well as on whether you want to manage your own money.
nwill002 said: I am changing jobs and going public sector and plan to roll my 401K into the 457b offered at my new job. Is there any reason why I may not want to do this and perhaps put it into an IRA instead? For a government 457b seems like there are only advantages to the 457b assuming the available funds are cheap.
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