Comments on: What is better a retirement plan or a 401K plan? Is there a difference and how much should I save a month? http://www.talkaboutretirement.net/uncategorized/what-is-better-a-retirement-plan-or-a-401k-plan-is-there-a-difference-and-how-much-should-i-save-a-month/ Issues concerns retirement and retired living Mon, 21 May 2012 12:39:53 +0000 http://wordpress.org/?v=2.6.3 By: muncie birder http://www.talkaboutretirement.net/uncategorized/what-is-better-a-retirement-plan-or-a-401k-plan-is-there-a-difference-and-how-much-should-i-save-a-month/#comment-53 muncie birder Fri, 12 Dec 2008 20:21:13 +0000 http://www.talkaboutretirement.net/financial-services/what-is-better-a-retirement-plan-or-a-401k-plan-is-there-a-difference-and-how-much-should-i-save-a-month/#comment-53 my preference is a Roth IRA. You can deposit upto $4000 a year if your income is under $100,000. The alternative is a tradional IRA. The difference is that with a Roth IRA you deposit after tax dollars and never pay any tax on the earnings of the account or until the government changes the law. With a traditional IRA you deposit pre tax dollars and do not have to pay any taxes on the money or income until it is withdrawn at which time you pay full taxes. Withdrawals from a 401k are treated like a tradtional IRA. You can establish an IRA account of either flavor with a stock broker or a mutual fund company. my preference is a Roth IRA. You can deposit upto $4000 a year if your income is under $100,000. The alternative is a tradional IRA. The difference is that with a Roth IRA you deposit after tax dollars and never pay any tax on the earnings of the account or until the government changes the law. With a traditional IRA you deposit pre tax dollars and do not have to pay any taxes on the money or income until it is withdrawn at which time you pay full taxes. Withdrawals from a 401k are treated like a tradtional IRA.

You can establish an IRA account of either flavor with a stock broker or a mutual fund company.

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