Can you have an IRA and a 401K?

by IRA Rollover in 401k, Gold IRA, Roth IRA with Comments Off on Can you have an IRA and a 401K?

If you are planning to save for your retirement you will inevitably ask can you have an IRA and a 401K at the same time.  Yes, you can, but there are important differences in the two accounts and many strategies you can use to optimize your funds.  In fact, many people get both types of accounts so that they can save and invest more in anticipation of an enjoyable and well-funded retirement.

There is a difference between the two accounts.  A 401K is an employer sponsored plan in which your employer contributes to the 401k roth irafund, sometimes matching your own contributions dollar for dollar.  This means you get up to twice as much in the account.  If you open an IRA you are the sole contributor.  As you can imagine, having both types of accounts means you have more security and many people see the logic of legally saving and investing every cent they can to insure a comfortable retirement.

There are legal federal restrictions on the amount that can be contributed to both types of accounts, depending on your income.  You can contribute more if you are 50 or over but less if you make over $122,000 as a single taxpayer.  Married couples who make a combined income of more than $179,000 cannot contribute to a Roth IRA.  You should check with a financial advisor to determine your contribution limits; you may not be subject to limitations on any retirement account if you are a low or moderate income taxpayer.

If you leave your employer you don’t want to leave your retirement funds with that employer.  You can convert that 401K to Roth IRA or a traditional IRA.  Transferring 401K to IRA accounts is a simple matter of contacting a broker, setting up an IRA, and completing the paperwork necessary to transfer the 401K funds into your new IRA.  You must put the funds from the 401K into the IRA within 60 days, however, or pay a hefty tax on it.  Completing the arrangement on day 61 can be very costly!

You can also convert 401K to gold in an IRA, which is what a lot of people are doing right now.  Faced with economic uncertainty, the threat of inflation, and a falling dollar there are many investors of all ages that are protecting their assets by buying gold.  The gold’s value is transferred to the IRA while the actual metal is stored in a federally approved, secure, and insured facility.  The value of that gold, unlike the dollars you invest, will never fall even though the price may fluctuate.  Gold will remain viable even if the dollar fails completely.

As you wonder can you have an IRA and a 401K at the same time you can be assured that both accounts can help your golden years be enjoyable and rewarding.

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