Discover Hidden IRA Benefits for You and Your Family

Discover hidden IRA benefits to supercharge your retirement savings. IRAs offer powerful tax advantages, but many people overlook these little-known opportunities.

Spousal IRAs

Even if your spouse doesn’t have a job, they can still contribute to an IRA if you file a joint tax return and have earned income. This is a fantastic way to double your retirement savings potential and potentially reduce your overall tax bill. By contributing to a spousal IRA, you’re effectively maximizing your tax deductions and building a stronger financial foundation for your family’s future.

• Tip: If you’re eligible for a spousal IRA, take advantage of it. It’s a powerful tool to boost your retirement savings.

IRAs for Children

Teaching your children the value of saving early can set them up for financial success. If your child has earned income from jobs, babysitting, or other ventures, they can open their own IRA. This instills financial responsibility and allows their money to grow tax-deferred or tax-free (depending on the IRA type).

• Tip: Consider matching your child’s contributions to encourage saving and accelerate their account growth.

IRA and 401(k) Compatibility

Many people believe that having 401(k) limits their ability to contribute to an IRA. That’s often not the case. Depending on your income level, you might be eligible to contribute to both. This allows you to diversify your retirement savings and potentially maximize your tax benefits.

• Tip: Review your income to determine if you can contribute to both an IRA and a 401(k).

Non-Deductible IRAs

If your income exceeds certain limits, you may not be able to deduct traditional IRA contributions. However, don’t let that discourage you. You can still make non-deductible contributions. While you won’t get an immediate tax break, your contributions and earnings will grow tax deferred.

• Tip: Consider a non-deductible IRA as a long-term investment strategy, especially if you have high income.

IRA Flexibility

IRAs offer more flexibility than many people realize. While early withdrawals generally result in penalties, there are exceptions for significant life events such as:

• First-time homebuyer
• Qualified education expenses
• Medical expenses exceeding 7.5% of adjusted gross income
• Disability
• Death

By understanding these exceptions, you can access your IRA funds when needed without facing unnecessary penalties.

• Tip: Familiarize yourself with IRA withdrawal rules to make informed decisions about your retirement savings.

If you have questions about IRAs or need personalized guidance on your retirement savings strategy, don’t hesitate to contact us at 832-303-3995 or book your appointment today. We’re here to help you reach your financial goals.