I purposefully put this on the Travel side of my blog as I know I have a lot of readers in the Millennial Generation who are jumping on travel deals and rebates, well tomorrow is the last day for your 2013 Traditional IRA contribution, and it can pay you up to 25% back in rebate depending on your tax bracket. You have two options: Roth or Traditional. The Roth will not give you a rebate, but the money will grow tax free, the Traditional will give you a rebate but will be taxed when you withdraw.
1. You don’t have enough money?
You don’t need to put in the full $5,500, why not just put in $500 today, you will get $125 in tax rebate from that at the 25% bracket.
2. You have filed your 2013 taxes already?
You can still contribute to 2013 retirement accounts, if you do a Roth then it is after tax, so doesn’t matter, you don’t report it on the return. If you do a Traditional you can request to alter your 2013 tax return with the new rebate added. I would only adjust my filed return if I was doing a decent sized contribution to the traditional.
3. You don’t know whether to do a Roth or a Traditional?
If you haven’t filed do a Traditional. If you have filed, do a Roth- Just do it. Capture the tax savings now, set aside some money for retirement in the future, and figure it out later. It may not be the absolutely perfect decision for everyone, but not doing it due to uncertainty is far worse. If you want to get into some of the math behind which is best, read this post. <income restrictions are here too>
4. You don’t know how to do it?
You can set up an account with any of the big firms, such as Fidelity, Vanguard, TD Ameritrade. It takes minutes online. Here is how I set one up with Vanguard read this post
5. You don’t know how to invest and what funds to pick?
It doesn’t matter! First thing, if you don’t contribute you lose up to $1,375 in tax rebates, secure that first, then worry about the allocations. Then read my post on which funds are best for your Vanguard Roth IRA
6. Saverocity posts are too long and I still don’t understand what the hell to do?
If you are procrastinating about funding an IRA. Ask any question in the comments below, from the most simple to the most advanced, i’ll answer it and you can make an informed decision to take control of your finances.