Hi, Terry–

I recently learned that I should not be putting money into two Roth IRAs monthly as I’ve been doing ($200 in one, $100 in another) because our combined income exceeds the limit to do so. I plan to contact each institution to cancel automatic withdrawals, but what other option(s) would I have to deposit that money each month? I’m not likely to put it into a 401K because my concern that it will be taxed at very high rates when I retire (I’m 53 right now). Any suggestions will be appreciated. Thank you.

Terry Says:  Here are the income limits for contributing to a Roth IRA in 2016, in case others are interested:

You can only contribute to a Roth IRA, however, if your income is below a certain threshold. For single filers in 2016, that income threshold starts at $117,000 (up from $116,000) and ends at $133,000 (up from $132,000). In that range, your contribution is limited, eventually reaching zero. For married filers in 2016, that income threshold starts at $184,000 (up from $183,000) and ends at $194,000 (up from $193,000).

You can probably transfer those contributions into a non-deductible traditional IRA, but consult your tax advisor. Do it before year-end!   As a strategy, I question why you wouldn’t contribute to a company 40l(k) plan if you have that option.  Your employer likely matches a part of your contribution — giving you “free money”!  So do that up to the limits of the match, at least.    If you have big gains, you shouldn’t be upset about paying the taxes, even though withdrawals from traditional IRAs and 40l(k)s are taxed as ordinary income.

The only other way to get tax free growth of your money is to open a 529 college savings plan for your children or grandchildren.  You won’t benefit from that — but they will!

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