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Brent Fulkerson
Financial Advisor
1stMidAmerica Retirement Services
Located at 1stMidAmerica Credit Union
1795 E Edwardsville Road
Wood River, IL 62095
Phone: 618-258-7804
Email: brent.fulkerson@lpl.com
May/June 2023
Traditional But Not Deductible
When investors examine their retirement investment options, they typically pay a great deal of attention to whether their contributions are deductible or not. There are a wide variety of investment accounts, from 401(k) and 403(b) plans, that offer this benefit regardless of income. For high net worth individuals, limits to how much they can contribute to these plans may leave them looking for another place to put additional monies.
The Roth IRA, which doesn’t offer deductible contributions but does feature tax-free qualified distributions, is one place to look. However, high net worth individuals often get shut out of investing in a Roth IRA due to income restrictions.
So, where can these retirement investors go if they max out on other traditional qualified accounts and don’t qualify for the Roth? A traditional, nondeductible IRA still offers potential tax-deferred gains. Talk to your financial professional to learn more.
IRA Rules
So why bother at all with a traditional IRA if you can’t defer taxes on contributions? Potential tax-deferred growth of your investments is the four-word answer. Additionally, the percentage of your contributions to investment gain also won’t be taxed when you begin distributions.There are other alternatives, including taxable investments and potentially qualifying for the Roth in some years by shifting income, so talk to your financial professional to learn if this approach is right for you.
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Brent Fulkerson is a financial advisor with, and securities and advisory services are offered through LPL Financial (LPL), a registered investment advisor and broker-dealer (member FINRA/SIPC). Insurance products are offered through LPL or its licensed affiliates. 1stMidAmerica Credit Union and 1stMidAmerica Retirement Services are not registered as a broker/dealer or investment advisor. Registered representatives of LPL offer products and services using 1stMidAmerica Retirement Services, and may also be employees of 1stMidAmerica Credit Union. These products and services are being offered through LPL or its affiliates, which are separate entities from and not affiliates of, 1stMidAmerica Credit Union or 1stMidAmerica Retirement Services. Securities and insurance offered through LPL or its affiliates are:
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