If you’d like to contribute to a Roth IRA, but your income is too high, do you have any options?
A Roth IRA is an attractive retirement savings vehicle, because earnings and withdrawals are tax-free, provided you’ve had your account at least five years and you don’t start taking money out until you’re 59½.
Also, with a Roth IRA, you won’t be required to take withdrawals when you turn 72, which will give your account a chance to potentially keep growing.
So, if you’d like to take advantage of this investment, you might want to consider using what’s known as a “backdoor Roth IRA.”
Essentially, this strategy involves moving money from a new or existing traditional IRA to a Roth IRA.
The process is straightforward, but you’ll need to consider potential tax implications.
Consult with your tax advisor to determine if a backdoor Roth makes sense for you — if so, it could be a valuable addition to your financial strategy.
This article was written by Edward Jones for use by your local Edward Jones Financial Advisor John Dickerson. Member SIPC.
