Author Topic: IRA confused!!!  (Read 1247 times)

Vonecut

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IRA confused!!!
« on: January 18, 2017, 08:37:56 AM »
Ok I'm a bit confused and will try and make this as clear as possible.

First off my question...
1.Where to invest next and
2. Is there a better way to handle my existing ira and old 401k to better take advantage of limiting taxes.

Given:

Age 46, single / head of household
Salary 150k
Investments:
Old 401k $110,000
Old 401k rolled over into IRA $160,000 (nothing added to this since rollover)
Current 401k $450,000 (company puts in 13% of salary. 5% match. + 8% no $$ match required)
I have access to good low expense funds in all three accounts mentioned above.
I put in max per year into 401k $18000
40k in liquid cash - emergency fund.
Plan to be in a much lower tax bracket once retired.
Not looking at retirement just yet... love my job!! Looking for age 55-60 retirement.
2018 will be adding an HSA.

Here is were I get confused. I can't put additional monies into a Roth IRA because I make too much. I can't back door a Roth IRA because I have an existing IRA from an 401k rollover. I can contribute to an IRA but again because I make too much I can't deduct any of that money. So, in that case what is the advantage of a regular IRA when it's all after tax money and you have IRA withdrawal restrictions. Why not just invest further money into a taxable investment account.

I want to invest an additional 10k a year for the next couple of years and then 10k+ extra till 55/retirement.

Here are my questions again....
1.Where to invest next and
2. Is there a better way to handle my existing ira and old 401k to better take advantage of limiting taxes.

Thanks



 

MrSpendy

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Re: IRA confused!!!
« Reply #1 on: January 18, 2017, 08:46:56 AM »
does your employer's 401k accept rollovers?

dandarc

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Re: IRA confused!!!
« Reply #2 on: January 18, 2017, 08:47:55 AM »
Option A: Roll IRA into your 401K if allowed, then backdoor Roth IRA
Opiton B: Taxable Account

Also look into if your 401K offers after-tax contributions in addition to traditional and Roth.  You may be able to do a Mega-Backdoor Roth that would cover all of your desired additional investing.

Vonecut

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Re: IRA confused!!!
« Reply #3 on: January 18, 2017, 09:45:19 AM »
does your employer's 401k accept rollovers?

So I check and they will accept 401k rollovers into my existing 401k.

Vonecut

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Re: IRA confused!!!
« Reply #4 on: January 18, 2017, 09:46:17 AM »
Option A: Roll IRA into your 401K if allowed, then backdoor Roth IRA
Opiton B: Taxable Account

Also look into if your 401K offers after-tax contributions in addition to traditional and Roth.  You may be able to do a Mega-Backdoor Roth that would cover all of your desired additional investing.

They do not allow after tax contributions in addition to traditional and Roth.