Disposable CD’s
Hello Terry
I plan on retiring next year in april 27 @65yr 8mo yrs old and have both a employer 401k and traditional ira.
I have several cd’s roughly $250k earning interest and about $9k in 1099-int. This tax season
I would like to cash these out at maturity and open a separate roth-ira.
Can I do this? Your thoughts are greatly appreciated.
Thks
Terry Says
I was intrigued by your headline — disposable CDs@! I’ve never heard of that term!
If you had earned income in 2025, you have until April 15th to contribute to a Roth IRA. However, you must meet the income limitations. Since you’re over age 50, you could contribute up to $8000 assuming you earned that much. However if you earn too much, you can’t contribute to a Roth.
Here are the 2025 maximum earnings levels for contributing:
Single filers / Heads of Household:
Full contribution if MAGI is less than $150,000
Partial contribution if MAGI is $150,000 to $165,000
Ineligible if MAGI is $165,000 or more
Married filing jointly / Qualifying widow(er):
Full contribution if MAGI is less than $236,000
Partial contribution if MAGI is $236,000 to $246,000
Ineligible if MAGI is $246,000 or more
And you can also make a contribution for 2026 earnings, if you have that much earned income. In fact, those over 50 can contribute up to $8600 in 2026.
For 2026 the caps are slightly higher for income before the phaseout — about $2,000 higher in 2026.
And though you didn’t ask, it strikes me that this would be a good time for at least one meeting with a fee-only FIDUCIARY financial planner to get this organized to create an income stream.
Read this and watch the new video: https://www.terrysavage.com/pam-krueger-wealthramp/
