Retirement Planning Essay

1278 Words6 Pages
Retirement Retirement seems to be one of the most often overlooked areas of people’s future plan. Simply because it seems so far away, it is an area that is subject to procrastination. People are expected to live longer now than ever before, this is another reason why young adults and teenagers are not worried about saving for their retirement. The baby boom generation, the seventy seven million people born between 1943 and 1960, face an entirely different retirement plan. As they began to retire, people are starting to think that there will be no money left and this will turn into a crisis. What will happen when seventy-seven million baby boomers begin to want the money they paid in… but it is not there? Retirement provisions such as…show more content…
Roth IRA’s are said to give Americans another way to save on taxes. A Roth Ira can be withdrawn tax-free, as long as the account has been open at least five years and you are age fifty-nine and a half when you begin withdrawing the proceeds. The contributions can be up to two thousand dollars per person or four thousand per couple. The beauty of a Roth IRA is its simplicity. You can contribute to a Roth IRA even if you have an employer-sponsored retirement plan. You can contribute to a Roth IRA even if you have an employer-sponsored retirement plan. You can make contributions to a Roth IRA at any age as long as you are earning income. Your contributions however, can’t exceed your income. Someone who contributes even a little as a teenager can end up with quite a bit of money later on. With a Roth IRA your beneficiaries will not have to pay income tax on it. A Traditional IRA is for taxpayers that are under the age of seventy and a half, who are still working. Some people prefer the traditional IRA because they can get an immediate tax deduction equal to the contribution they put in. The money in a Traditional IRA grows tax-deferred. You have to pay a tax on all your earnings. Distributions of a Traditional IRA are required at the age of seventy and a half or you have to face penalties. There are also penalties on withdrawals before the age of fifty-nine and a half such a ten percent tax unless the money is
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