Stay-at-home moms or dads can be covered under an IRA, according to an article by Money Smart Life.
They're called spousal IRAs and they work for non-working spouses. Fortunately, they don’t require a job or income. As long as one spouse makes enough to contribute to an IRA, the unemployed spouse can make an equal contribution to that of the working spouse’s contribution, the article says.
Both investments are tax deductible for the working spouse. In 2012, the highest contribution that could be made for an IRA was $5,000, but this year it’s been raised to $5,500. And once you’re older than 50, an extra $1,000 can be added, Money Smart Life says.
“For a non-working spouse, $5,500 is a whole lot better than having no retirement plan at all. If contributions can be made consistently for at least 15 years, the account will easily exceed $100,000 by retirement age, taking investment earnings into the mix,” according to the article.
Contributing to a spousal IRA can extend to Roth IRAs, but it isn't tax deductible. Roth IRAs can have withdrawals taken for free as long as you are 59½ or older and it’s existed for five years.
- BYU grad strikes gold teaching via online...
- The 10 most livable small towns
- There's a video for that: How YouTube brings...
- Remodeling? Experts say some projects add to...
- Dave Ramsey says: Don't leave an estate with...
- Plan to simplify 2015 health renewals may...
- Closet clutter: How having fewer,...
- Fast food workers vow civil disobedience
- Fast food workers vow civil disobedience 13
- Most American high schoolers don't know... 13
- Dave Ramsey says: Don't leave an estate... 9
- Does getting married really increase... 8
- BYU grad strikes gold teaching via... 8
- Remodeling? Experts say some projects... 5
- Balancing act: Survey says lack of... 4
- Sneaky tricks restaurants use to make... 3