Indianapolis elder law attorneys can help you to be proactive about creating a plan for a secure retirement. Today, many people have no access to traditional workplace pension plans, called defined benefit plans, which paid a guaranteed income throughout your retirement. Instead, many employees — particularly in the private sector — either have no retirement accounts at all or have access only to a 401(k). Because you have to take control over your own retirement savings and cannot count on an employer to provide income during your golden years, it’s important to make a financial plan.
Frank & Kraft can help. We can assist you in setting the goals you need to achieve financial security in retirement and we can help you to understand the rules for investing in tax-advantaged retirement accounts that will help you to achieve those goals. You should work with an experienced attorney to make your plans for retirement when you are still as young as possible so you have more time to save, invest, and allow compound interest to work for you. To find out more about how Indianapolis elder law attorneys can help you to create a comprehensive retirement plan, give us a call today.
Tax-Advantaged Retirement Accounts Have New Limits in 2018
When you invest for retirement, putting money into accounts that provide you with tax breaks can help you to grow your nest egg more easily. You have different options, including accounts that provide an up front tax break by allowing you to put money in with pre-tax dollars and accounts that allow you to take your tax break during retirement. If you opt for the later, you will invest with after-tax dollars today but will not have to pay taxes on money that you take out of your account, including on gains on your investment provided you comply with rules for withdrawals.
The types of tax-advantaged retirement accounts you have access to will vary depending upon whether your job offers a 401(k) and depending upon whether you are self-employed or are an employee. If your job offers a 401(k), your company may offer you a traditional 401(k) which gives you up front tax breaks, or may offer you a Roth 401(k) which allows tax breaks as a senior. You may also get to chose between these account types or allocate some of your money to each different retirement account.
Regardless of whether your job offers a 401(k) or not, you may also be able to contribute to a traditional or a Roth IRA. If you contribute to a traditional IRA, you get the immediate tax breaks and invest with pre-tax funds but if you contribute to a Roth IRA, the tax breaks comes as a senior. Both traditional and Roth IRAs have limits on who can contribute and get tax benefits, with some high earners not eligible. For people who are self employed, there are also other options such as a SEP-IRA.
All of these different kinds of accounts have contribution limits, which change periodically. In 2018, for example, the contribution limit for a 401(k) went up from $18,000 to $18,500. This is the limit for your contributions; any contributions your employer makes on your behalf do not count towards the limit. If you are over the age of 50, you also get to contribute an additional $6,000 in catch-up contributions. While the contribution limit fro 401(k)s went up in 2018 compared with 2017, contribution limits for IRAs remained at $5,500 or $6,500 if you’re over 50.
Getting Help from Indianapolis Elder Law Attorneys
Indianapolis elder law attorneys at Frank & Kraft can assist you in determining if you are eligible to contribute to an IRA and can help you to determine if you should contribute to a Roth or a traditional IRA. We can also provide the assistance that you need to set goals and protecting your growing retirement nest egg.
Your future is too important to leave to chance, and there is likely no one to provide for you in retirement but you. You owe it to yourself to be proactive in taking steps to ensure you have plenty of money saved for a secure retirement. Working with a compassionate and knowledgeable member of our legal team to set goals and implement a comprehensive retirement plan is key to making sure you will have the money you need as a senior.
To find out more about how our firm can help with your retirement planning process, join us for a free seminar. You can also give us a call at 317-684-1100 or contact us online to get personalized help with the creation of your customized retirement plan. Call now to get your plan started, as the sooner you begin to save the better your chances of having the money you need as a senior.
Mr. Kraft assists clients primarily in the areas of estate planning and administration, Medicaid planning, federal and state taxation, real estate and corporate law, bringing the added perspective of an accounting background to his work.