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IRA's

Discussion in '2000-02 Archive' started by Vicki, Jun 7, 2002.

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  1. Vicki

    Vicki New Member

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    I would say that this is a stupid question but then people remind me that there is no such thing as a stupid question except for the one that is not asked,.....so here goes! I have two questions about IRA accounts. First, can you move the money in an existing account to any other place (i.e., to a different bank or organization) or does the money have to remain there? And second, what is the main difference between an IRA and ROTH account (and is one better than the other?) O.K.,...I guess that is really three questions :confused:
     
    #1 Vicki, Jun 7, 2002
  2. Johnv

    Johnv New Member

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    You can move money from any one IRA to any other IRA, or from any other account to an IRA. The trick is, once it's in an IRA, you can't move it out of an IRA (except another IRA) without paying a hefty penalty (there are exceptions).

    A traditional IRA allowes to you deposit the money tax exempt. The down side is, you pay taxes late, when you withdraw the funds. A ROTH IRA is the opposite. You pay the taxes now, and don't pay the taxes upon withdrawal. The return is probably better (arguably) in a ROTH, but you risk losing any guarantees of the tax code remaining constant over the next 30 years.
     
    #2 Johnv, Jun 7, 2002
  3. bb_baptist

    bb_baptist New Member

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    I think your questions have been aswered above. I would only add that a 401(k) plan (if your employer has one) is better than any IRA.
     
    #3 bb_baptist, Jun 9, 2002
  4. kim532

    kim532 New Member

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    Another advantage to a Roth IRA is that any money you put into it can be withdrawn for any reason with no penalties( usually a minimun time of a year is required). You can't touch any interest on the money but the rest is free game. I learned this on a radio show and then verified it at www.schwab.com
    Hope this helps in any decision making.
     
    #4 kim532, Jun 13, 2002
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