Can I Still Contribute to My IRA or 401k for Last Year?
You can contribute to your IRA for 2021 until April 15, 2021. In the case of a 401k, the same deadline applies.
IRA Contribution Limits
The contribution limit for both traditional and Roth IRA accounts is $6,000 for 2021 and 2022 (or $7,000 if you’re at least 50 years old). Both account types offer the ability to deposit money towards the prior year’s contribution limit, giving you more opportunity to fill your retirement accounts if you haven’t yet made a contribution.
Your IRA contributions may be tax-deductible. The deduction may be limited if you or your spouse are covered by a retirement plan at work and your income exceeds certain levels. Source: irs.gov
Solo 401(k) Contribution Limits
If you are self-employed, be sure to set up a solo 401(k). The solo 401(k) contribution limit is up to $58,000 in 2021 and $61,000 in 2022. If you’re 50 or older, there is a catch-up provision of an additional $6,500.
Can I Contribute to Both an IRA and a 401(k)?
Yes, you can contribute to both a 401(k) and an IRA. However, if your income exceeds the IRS limit, you may not be able to take advantage of some of the tax benefits of a traditional IRA.
Don’t Forget Spousal IRAs
A spousal IRA allows a non-working spouse to make contributions to an IRA account. Spousal IRAs can be structured as either traditional or Roth IRA accounts. Both types of IRAs allow a couple to make contributions to each other’s accounts. For a spousal IRA to qualify as a Roth IRA, the non-working spouse must earn less than $100K per year.
What is the Best IRA Account?
Do you want less choice or more choice? Assuming you want more choice, including the ability to invest in private alternatives such as real estate, debt, crypto, venture capital, or other private investment funds, without giving up the ability to invest in public market stocks, mutual funds, and ETFs, the only choice is a self-directed IRA (SDIRA).
Make sure the IRA custodian you select allows you the full range of choices you have a right to invest in. Not just public market mutual funds and ETFs, or worse, only their own offerings.
Which Custodians Can I Open a Self-Directed IRA With?
There are many custodians available. The Kirkland Capital Group Investment Partners & Platforms page lists some that the Kirkland Income Fund investor family has used, however, there are many more out there. When you are making your selection, compare fees, limitations, and features to determine which custodian matches your needs.
It’s important to note that while SDIRA custodians charge fees directly, it doesn’t mean you are paying more. All IRAs have fees, as that is how custodians make money. If the fee is not obvious, then there are hidden fees you are being charged.
Don’t wait. Take charge of your retirement plan accounts and get your money working for you.
