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Originally Posted by kristinecfp
Hi Lefty,
Yes, you can invest in a Roth IRA, even if you have an employer sponsored retirement plan. However your income must be below $160,000 if you're married, and $110,000 if you're single.
Whether you should do this depends on several things:
1. Will they still provide the additional income you mentioned, if you do not invest it in the tax-deferred annuity?
2. Do they match any of your contributions to the tax-deferred annuity?
3. How good is the annuity? Does it have low or high annual fees? What is the guaranteed rate of return (or is a variable annuity)?
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Thanks for the response Kristine. First, my income is too high for a Roth so that is out. My employer provides the additional income for the tax deferred variable annuity but I can do with it what I wish. What they did was end our old 401K w/matching contributions a few years ago. They folded it into the annuity and started paying me additionally to fund it. As for how good the annuity is, I believe it to be low annual fees as compared to others. It is with Fidelity Investments. I do not believe it has any guaranteed rate of return only that it can be no lower than the most I have contributed? Sound right? I have it split among 5 funds and it is doing well if looked at purely from a performance standpoint. I obviously need to learn more about it and feel somewhat foolish because I am now finding out I don't really understand what it is or what is happening/will happen with my money!!
Since the Roth is out due to our income do you know if my wife and I can both contribute to a traditional IRA even though I have the annuity? she has no "qualified pension plan" only several IRA's from past employers.
Again, thanks for the help.