401k and Roth IRA
Terry, I became a widow this year and I am still working full time at turned 72 in November. I took my RMD but want to return $7000 )I think that’s the maximum I can contribute) to my Roth IRA. I have a Schwab IRA and Roth IRA. I have a Vanguard 401k account at work and contribute 10% but I have seen about $20,000 of loss this year and my funds are diversified. I’ve been reading about the Treasury bills and think I should stop contributing to my 401k and invest in those instead. I plan on continuing working a couple more years. Do I have until April 2023 to contribute the $7000 to my Roth or should I do it now, and should I invest in the Treasuries instead of the Vanguard 401k?
Thank you!
Terry Says
Whew, you’re in a good position with good choices. First — and most important — does your employer match your 40l(k) contribution to any extent?? If yes, then do continue making the contributions or you’ll miss out on all this “free money.”
If you earned $7,000 in income you can contribute that much to your Roth. You get no tax deduction, and have to pay taxes on the money as a withdrawal before you invest the balance. So I don’t see any reason for contributing to a Roth at this point — especially if you just want to invest in T-bills (which you can do through an IRA with Schwab).
Instead, just open an account at TreasuryDirect — read this: https://www.terrysavage.com/t-bills-beat-cds/
