Hi all. Investing isn't my forte, although I find it fascinating, so I have tended to keep things pretty simple. I have read the stock series many times, and recently purchase the book as well (thanks to an Amazon credit it was free actually). Now I am struggling to understand where to go from here.
Up until this point, I have maxed out our t-IRAs at the beginning of the year ($5,500 each). Now however, our (DINKs - no immediate plans to change that) income is creeping up to the level where we will no longer be eligible for the full deduction on our t-IRAs, possibly beginning next year. Jim Collins suggests that a non-deductible IRA adds complexity and confusion to taxes, and I do NOT want any additional complexity. So here are my questions:
-Is a non-deductible IRA where my money contributed over the deductible limit will go? For instance if I contribute $5500 and can only deduct $4500, does the rest automatically go to a new 'non-deductible bucket,' or do they just tax me on it that year when doing my taxes (which I do myself on turbotax hence the desire for simplicity).
-At the beginning of the year when I fund the IRAs, I don't know what our AGI will be for the year. Our raises and bonuses vary, and sometimes we may have tuition to deduct. Should I still fund the full $5500?
-If yes above, how do I track what is deductible and what is not, and how long do I have to track it, and what do I need to do with said tracked info.
-At what point (if any) do I cease funding the IRA at all?
Any other tips? We do already max both 401ks and we do not have an HSA available at this time. I will admit to some fear and lack of knowledge regarding health insurance, and I do need to look into that stuff before the next open season. If there is no more tax advantage space left for us, that's fair, I just want to be sure to use what I can before I start padding the taxable account. We have no house, and we have no 529 or plans for one.
Thanks in advance for the help.