Retirement Savings Options: IRA Contributions & Roth Conversions

Today’s Prep:

What happens if you’ve maxed out your 401(k) contribution limit? When is a good time to make a Roth conversion? Eric answers three questions from the mailbag this week all pertaining to the options you have when it comes to saving for retirement.


Equipping Points:

Are you trying to save as much as possible for retirement? What happens when you bump into the contribution limit–what other options do you have? On this episode of the Retirement Ready podcast, Eric answers three questions from listeners.

Claire in West Des Moines got a big bonus check, maxing out her 401(k) contribution for the year. How can she save in other ways this year? Depending on income level, Eric says to possibly contribute to an IRA or a Roth IRA. If those aren’t an option, annuities or life insurance are another thing to look at.

Doug in Ames was told to make Roth Conversions with his IRAs but was told he made too much to contribute to a Roth IRA. How does this work? What will happen when you make a Roth conversion? What kind of strategy should you implement when it comes to Roth conversions?

Catherine in Pella wants to retire in order to help take care of her mother but she is only 57 years old. Is it foolish to consider early retirement at this point if she’s been a good saver? Be sure to check with your advisors, but it’s definitely an option if you have enough to live on. Just remember to fill your income gaps.

Do you have a question for Eric? You’re always welcome to give Eric a call to talk through your situation to find out what makes the most sense for you.

Listen to the full episode or click on the timestamps below to hear more about a specific question.

0:46 – Mailbag: Outside of a maxed out 401(k), where can you save?

1:56 – You can also make a nondeductible IRA contribution.

4:26 – Mailbag: How and when do you make Roth conversions?

7:28 – Mailbag: Is it foolish to retire in your late 50s?

9:07 – Retirement is about filling your income gap.



Related Resources:

Facing The Final Decade Before Retirement

Answering The 401(k) FAQs


Today’s Takeaway:

[spp-tweet tweet= “By the time you get to our office, we’re telling you it’s okay to spend your money. We’re helping you do it in the best way possible by reducing the tax ramifications and risk ramifications. That’s why I call myself a retirement planner instead of a financial advisor.  –Eric Peterson“]

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