Bank Deal: Earn 1.00% APY on an FDIC-insured savings account at Barclays.
As a followup to my post about withdrawing contributions from your Roth IRA without paying taxes or penalties, I wanted to point out a small(ish) glitch that was brough to my attention by a reader…
Withdrawals from your Roth IRA may make you ineligible to take the extra “saver’s credit” on future contributions. The way it’s figured, you need to subtract withdrawals made in the past few years from the current year’s contributions. In other words, if you took $2000 out two years ago, and put $3000 back in this year, the saver’s credit calculation says you only deserve a credit based on $1000. And you are punished for the withdrawals in this way for several years. So it’s true that you don’t pay taxes or penalties for taking out Roth contributions, but it can still cost you.
Click here for an article on the saver’s credit.
Thanks to reader EC for the tip.
- How to Become a Millionaire
- How to Get Out of Debt
- The Best Dollars I've Ever Spent
- How Our Estate Plan is Structured
- How We Paid Our Mortgage In Less than 10 Years
- Money Making Ideas
- How to Manage Your Asset Allocation with Multiple Accounts
- Consumption Smoothing - Save While the Saving's Good
- How to Save on Groceries
- How Much Life Insurance Do You Need?
- Eleven Great Books About Money
- Dave Ramsey is Bad at Math (693)
- Dish Network Customer Service SUCKS (537)
- $8,000 Homebuyer Tax Credit (429)
- Pay Off Mortgage Early or Invest? (424)
- How to Claim the First-Time Homebuyer Tax Credit (352)
- Termite Control: Sentricon vs. Termidor (330)
- How Much Should You Pay a Babysitter? (292)
- Ethanol Blended Gas = Lower Mileage? (273)
- Reduced Credit Limits? Share Your Experience (256)
- $15,000 Homebuyer Tax Credit (242)
- Buying Furniture off the Back of a Truck (237)
- Will Mac OS X Lion Kill Quicken 2007? (191)