4 Ways to Maximize Your Retirement Account

Many people today are not going to have much of a retirement because they do not have enough money saved up. Many others have not thought much about it and made no plans for it. If you want to have a retirement where you can relax and enjoy your senior years, there are four ways that you can maximize your retirement account.

Different Types of IRA’s

Having an individual retirement account (IRA) can give you an excellent way to save for retirement. There are two different types and one may be more to your advantage than the other. They are:

• Traditional IRA – This type of IRA allows you to put money in the account up to a limit. The money may be tax-deductible, but this will depend on your income. All growth in the account is tax-deferred until after retirement when you will pay less in taxes.
• Roth IRA – A Roth IRA works in the opposite way. You will pay income taxes on the money that you put in, but will not pay Federal taxes when you withdraw it. Some states may require taxes on your withdrawals.

The amount of your contributions to an IRA is limited by the government. The limits are changed from time to time. If you are under 50, you can put $6,000 into an IRA per year. People who are older than 50 are given an opportunity to “catch-up” and make an additional contribution of $1,000 per year (total of $7,000). Contributions to an IRA can be deducted from your taxes up to tax day.

How Does an IRA Work?

An IRA is an account set up by a financial institution for you to be able to save money for retirement. The two types allow you to save money that is tax-deferred or completely tax-free.

The best way to use an IRA is to put as much money into the account each year as you can. If you can afford to put in the limit, the better off you will be in retirement. A traditional IRA lets you make contributions up until you are 70 1/2 and withdrawals must also start at that age.

In a Roth IRA, you can make contributions at any time without limits and withdrawals at any age are not mandatory.

Precious Metal IRA

Another way to increase your retirement account is to use gold IRAs. This special type of IRA, called a self-directed IRA, can add precious metals to your retirement plan.

Gold has a unique advantage over paper-backed investments. When the economy takes a nosedive, gold will nearly always increase in value. There will always be a demand for gold because it is used in so many things: jewelry, smartphones, laptops, solar panels, and much more. There are also many industrial uses for it.

The ongoing demand for gold will continue. The supply, however, is limited and this will also help its value to rise. This makes gold and other precious metals the one thing in your IRA that can help to increase its value over the years – ensuring that you have a retirement fund that continues to grow.

How To Put Physical Gold in Your Account

You can add physical gold into your account by purchasing a gold IRA. You need to be aware that it will only strengthen your retirement account if it is held by a custodian that has been approved by the IRS. They will hold it in a specially licensed depository that is also insured.

It must be held by them until you are at least 59 1/2. At that time, you can start to take distributions. You cannot store gold in your home and have it add any value to your IRA.

How to Make your money work for you

Starting to invest in an IRA as soon as you are able will give you a good start. Even if you cannot add much now, it will still enable you to get a larger sum by retirement age. Adding gold to your account in a self-directed IRA will enable you to have greater stability in your IRA, even if the economy does not do very well. Making automatic contributions to it will also help you not to spend your money elsewhere.

Saving tips

As you prepare for retirement, you want to add a reasonable amount regularly. Any regular amount added to it starting early will result in larger totals than if you made larger contributions starting later. By using a traditional IRA that lets you get tax-deductions on your contributions, you can add more.

You can also make larger contributions if you control your spending. One other thing you can do is to hold off on collecting Social Security, which will enable you to earn more per month.

Buying gold while it is low in cost will also enable you to add more. Now is the best time to get a gold IRA so you can have an even better retirement.