WooHoo! I just maxed out ny ROTH IRA!

[Hedy]

I just met the max contribution for my first year of ROTH IRA contribution. Yay me!

[sweeps]

Congrats!

[Broken Arrow]

Yay you.

[disneysteve]

Congrats. Keep it up, and remember the limit goes up to $5,000 in 2008. Since you've already maxed out for 2007, keep putting aside ROTH money in your money market account or wherever and after January 1, deposit whatever you've accumulated into your ROTH towards your 2008 contribution.

[Hedy]

Congrats. Keep it up, and remember the limit goes up to $5,000 in 2008. Since you've already maxed out for 2007, keep putting aside ROTH money in your money market account or wherever and after January 1, deposit whatever you've accumulated into your ROTH towards your 2008 contribution.

Will do.

[InDebtInDC]

Congrats. Keep it up, and remember the limit goes up to $5,000 in 2008. Since you've already maxed out for 2007, keep putting aside ROTH money in your money market account or wherever and after January 1, deposit whatever you've accumulated into your ROTH towards your 2008 contribution.

Will the interest be considered capital gains or if you dump it into the ROTH you're fine?


Good going by the way.

[disneysteve]

Will the interest be considered capital gains or if you dump it into the ROTH you're fine?

Any interest earned in a taxable account would still be subject to tax on your 2007 tax return. But it is still a whole lot better to save it for the next 2 months and get a jump on the 2008 IRA.

[FinWhiz]

That is fabulous!

[ktmarvels]

I was wondering is it better to max it out your roth on January 1 or contribue some each month?

I already maxed out 2007 and have been saving for 2008. In January I won't have saved the max, but could "borrow" from some of my other saving accounts (like house downpayment fund) to make the max if that makes more sense financially.

[LivingAlmostLarge]

It depends, I used to contribute january 2nd, but if you are close to the income limit restrictions, you should do it january 2nd of the year after. That way you can figure out if you are eligible or not.

I think it's more hassle to contribute and have to take out the contribution and earnings and pay taxes on the earnings if you go over the income limits.

So it does make more sense to contribute lump sum at the beginning of the year because you get a longer window of investment.

[disneysteve]

I agree. Makes more sense to invest it all upfront to maximize the time your money is growing tax-free. The only exception, as noted above, is if you aren't sure if you will qualify for the contribution. I did once have to undo a contribution and it really wasn't a big deal.

[anonymous_saver]

I was wondering is it better to max it out your roth on January 1 or contribue some each month?

I already maxed out 2007 and have been saving for 2008. In January I won't have saved the max, but could "borrow" from some of my other saving accounts (like house downpayment fund) to make the max if that makes more sense financially.

If I were you I would just take the money you have saved for your 2008 Roth IRA, and put it directly into your Roth IRA on January 1st. Then I would save for the rest of the amount allowed in 2008. That is, I wouldn't take money out of your down payment fund or any other account you have (particularly your emergency fund) just to get your $5,000 in on January first.

[LivingAlmostLarge]

Disneysteve how did you calculate your earnings on the amount?

[disneysteve]

Disneysteve how did you calculate your earnings on the amount?

Not sure what you mean. Or, by chance, did you mean to post this on the mortgage prepayment thread?

[LivingAlmostLarge]

No you said you had to withdraw your IRA deposit, and the earnings from the money too right? I did and found it took a lot of extra paperwork to do.