Learning, Sharing, and Teaching > Ask a Mustachian
Help-Stupid idea to pump money into a Traditional IRA?
kilogulf:
I just did a rollover of 3 previous 401k’s into a Vanguard Traditional IRA. My asset allocation is 100% VTSAX. Now what do I do? It’s all tax deferred funds in there now and it’s just sitting there. If I set up monthly contributions from my post-tax dollars, then it’s a Roth. Can you mix pre-tax and post-tax dollars into a Traditional?
I currently do not have an employee sponsored 401k because it’s a new employer and I have to wait until the first of the year to enroll. I am told my new employer will match 3% on a SIMPLE IRA at that time. I’m not sure I will be able to dovetail that account into my Vanguard, so I will have yet another 401k with worth peanuts…at least for a while.
It's driving me nuts just watching my 880.611 shares of VTSAX bounce up and down every day. I want to buy more shares but I don't want to pay taxes on post-tax contributions.
Thanks for any guidance....
Ken in Dallas, Tx
JLee:
You can contribute your post-tax dollars to a Traditional IRA and then take a tax deduction when you file taxes.
kilogulf:
Thanks JLee. I would imagine that Vanguard will provide a statement at the end of the year showing pre and post tax contributions? This is my first time with Vanguard as well as being in this situation.
walkwalkwalk:
To my knowledge, noone tracks your pre and post tax contributions but yourself and maybe your tax advisor if you give him the information. I would keep track of this myself if I were you and then if you get some kind of statement, then you could compare it for accuracy.
kilogulf:
Thanks MMbergmann. Ya I'm not the type to trust all that to a statement from Vanguard. I will be able to capture that information for my tax guy without much issue. Thanks for chiming in...
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