Setting up a Self-Directed Roth IRA in 2010
For those looking to take control of their own investments while avoiding future taxes, now may be the time to set up a self-directed roth ira. The stock market is beginning to look more attractive (still more than 30% off it’s summer of ’07 levels) and new roth ira owners are still able to withdrawal their money tax free upon retirement. Regardless of whether or not you are comfortable making your own investment decisions, you should still set up an IRA (traditional or roth). The roth comes with more tax benefits, however, you may be ineligible to begin one of these accounts if you earn to much money.
Setting up a new IRA? Get an $800 bonus from E-Trade!
Self-Directed Roth IRA quick facts:
- requires the account owner to make investment decisions and investments on behalf of the retirement plan
- Self-directed IRA accounts are generally not limited to a select group of asset types (stocks, bonds, mutual funds, etc)
- brokers permit their clients to engage in most or all investments
- possible investment options include, but are not limited to, real estate, mortgages, stocks, bank CDs, bonds, franchises, partnerships, etc.
By allowing the self-directed roth ira owner to not only control his/her own investment decisions but also allow such a wide range of investment choices, the owner can benefit from the diversity of their investments as well as their own independent research.
Contribution Limits and rule adjustments for 2010:
- $5,000 (or $6,000 for those age 50 and above)
- the $100,000 modified AGI limit for conversions to Roth IRAs has been eliminated this year (which means that married couples filing separate returns can now convert amounts to a Roth IRA)
