Ask Terry Questions IRAs for non-working spouse?

IRAs for non-working spouse?

By Terry Savage on May 18, 2014 | Financial Planning / Retirement

Are there any IRA Roth or regular options for a stay at home mom with a working husband? My daughter would like to continue saving for retirement even though she is now a stay at home mom. Can she do an IRA without an income?

Terry Says:  Yes, absolutely the non-working spouse can, and should, have her or his own IRA.  This is the one instance in which you can contribute to an IRA even if you don’t have “earned income.”  The working spouse can contribute up to the limit ($5500 under age 50) for the stay-at-home spouse.  (And really that’s a better description than “non-working”!)  The IRA will be deductible on the joint return — unless you qualify based on income for a ROTH IRA, which doesn’t get you a deduction, but is promised to grow tax-free (unlike a traditional IRA for which you get a deduction from current taxes for your contribution, but then pay taxes when you take the money out in retirement.)  The spousal IRA belongs to the individual spouse, building security for the future.

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