Deciding whether to contribute to a pre-tax or Roth retirement account is one of the biggest factors when it comes to saving for your retirement. Both offer tax-free compounding, but they differ in when and how you’ll get taxed on your income. Some retirement plans, like the IRA, 401k, and solo 401k, offer both a […]
A SIMPLE IRA has smaller contribution limits than a 401k, but provides a simpler and cheaper option for employers to offer a retirement plan for their employees. If your company sponsors a SIMPLE IRA, here’s how much you can contribute as an employee and employer for 2022 and 2023. SIMPLE IRA contribution limits Employees can make […]
What is a SIMPLE IRA? A SIMPLE (Savings Incentive Match Plan for Employees) IRA is a retirement plan for business owners with fewer than 100 employees. It’s essentially a cheaper, simpler alternative to setting up a 401k plan for small businesses. Unlike other business retirement plans like the SEP IRA and solo 401k, which provide […]
If you’re a business owner, you have the option to open a SEP IRA or 401k at your company. These accounts can only be opened by a business owner; employees cannot establish a 401k or SEP IRA on their own, like they could with an IRA. The main difference between the two accounts is that a business […]
Two of the most popular types of retirement accounts are the 401k and the IRA. They both offer tax advantages but have different eligibility rules, contribution limits, withdrawal rules, and investment options. Main differences between a 401k and IRA The rest of the article below will expand on these differences. Eligibility differences A 401k is an employer sponsored plan and […]
Retirement accounts like a 401k or solo 401k allow you to take out a loan from your account. Unfortunately, there’s no such thing as an IRA loan. However, there are work arounds that allow you to temporarily access your IRA funds that work similarly to taking out a loan. With a 401k loan, you’re allowed […]
OVERVIEW A 401k loan allows you to borrow money from your own 401k plan. You’re allowed to borrow up to 50% of your plan value, up to a maximum of $50,000. Here’s everything you need to know about a 401k loan’s interest rates, taxes, and fees. What are the interest rates on a 401k loan? The interest […]
401K BASIC WITHDRAWAL RULES Retirement plans, like the 401k, have an eligible age for making qualified withdrawals. If you take money out of your account before you reach the eligible age, you’ll have to pay penalties and taxes. When can you withdraw from a 401k? The eligible age for withdrawing from a 401k is 59½. Earlier […]
The employer-sponsored 401k plan comes in two different account types: Traditional and Roth. The main difference between them is when and how they get taxed. Traditional 401k contributions give you tax benefits when you contribute money into your plan. Roth 401k contributions give you tax benefits when you withdraw money from your plan. Here’s everything […]
