Roth IRA –if eligible?
Greetings Terry love your advice columns. My question is Roth IRA’S ARE THEY limited to certain income amounts? We just paid off are home and are about 2 years out of retirement we both have decent retirements lined up.
What should we do with our freed up mortgage payment. I would not mind paying taxes up front on a Roth but as I understand we do not qualify.
Terry Says
First, you must have earned income. If you do, you can each contribute up to $8,000 for 2025.
BUT, there are income limits:
For joint filers, in 2025 your MAGI must be under $236,000 to make a full Roth IRA contribution.
If you don’t qualify based on income, you can still save the money! Just redirect that monthly amount into a money market mutual fund, or purchase Treasury bills with staggered 6-month maturities. REad this:
https://www.terrysavage.com/t-bills-beat-cds-2/
OR, you could purchase a multi-year guaranteed annuity (MYGA). It’s the insurance industry’s version of a CD — and the interest earned is not taxed until withdrawn. Learn about rates here: https://www.stantheannuityman.com/annuity-calculators/myga
