IRA-How much do you need to open one and how much do you have to put in each month?
Answers: Well I would personally sit down with you and your spouse and talk to ya'll about doing a FNA ( a written game plan) to help you guys setup up a spending plan, protect what you have now, then help you get out of debt as quick and most cost effectively as possible. Then after freeing up some extra cash, set up a money market for short term goals and emergencies $100/month would be great to start and setup the Roth IRA's for your long term goals $250/month would do quite nicely.Which (a) 5% MM would grow to $84,019.41 and the Roth (a) 10% would grow to $574,790.68 in 30 years for an early retirement or you can add on to that by working longer and retire at 63 an millionaire. After all you debt paid off, the investment could grow greatly larger. Get all the details such as cost,renewablity, fees on any product. Ask more question than the person your talking to can answer that will be when you will learn the important details. But to answer your question directly I offer my clients mutual funds for as little as $50month but if I can free up money in other ways it will be better for them in the long run. Also look at your companies 401k plans many matches your investment up to a point ( free money) and I would have you let me take a look at that as well.
How much to open one depends on the facility where you will place the money. For example, for a brokerage account with Scottrade, the minimum is $500. However, if you just wanted a savings account, probably $25 would suffice.
You do NOT have to make monthly contributions. You are LIMITED to what you can contribute in a year--under 49 is limited to $4K AND all of that must be EARNED income so people can't put in gift money or such.
You would choose basically between a traditional IRA (whatever you put in doesn't count as income on your taxes) OR a Roth (you pay tax, but when you are able to withdraw, that money is not taxed as it already was taxed).
You can have a 2007 IRA with money contributed up through 15 April 2008, but you need to make sure it is labelled as for 2007 in any case.
If you are living paycheck to paycheck, you'll need to save for a while before you can open an IRA. You might think of opening a 529 account for your children's education instead. Minimum is only $100, and when they go to college, they wont have to borrow money.
How do I go about borrowing from my 401K?
Answers: 1. Check to see if your plan allows general purpose loans for any reason or hardship withdrawals. They are treated differently and hardship you must qualify for the withdrawal.
2. Assuming you can have a general purpose loan. Call the 401(k) plan provider and your HR department to make the loan modeling/amortization schedule happen.
3. Get ready to pay back payments out of your paycheck. That is what the loan modeling is for to tell you how much will come out of your check. The amortization schedule is the final document outlining the amount of payments and the due date. Typically 5 years unless you want a loan for a shorter term.
4. You get your check and spend the money.
5. Keep in mind that if you leave the employer that the loan typically comes due immediately. This means if you don't have the money to pay it back you are taxed on the amount and are defaulting on the loan. It's really no big deal other than you don't pay yourself back the monies.
Good luck!
I am not that sure, but you do know that you will be penalized a lot for withdrawing money from it.
Is the money I contribute into my FSA relative to my current employment.?
Ok, let's say I own an FSA at my current job. If I settle on I'm going to leave that career and use up all my FSA that I hold for that year, will I be able to contribute more at my subsequent job? Why I'm asking is if I hold elected to hold $1000 in my FSA for 2008. I enjoy that available balance surrounded by my account in a minute. If I'm planning to leave my current living in February, does it spawn sense that I could go out and use the $1000 from my current mission? Furthermore, will I be able to start another FSA at my up to date job? This sounds too accurate to be true if I can. Sounds like "free money"Answers: An FSA is a benefit that is to say offered BY AN EMPLOYER. When you terminate your employment beside that employer, you can submit claims for expenses incurred UP UNTIL THE DATE YOU TERMINATED EMPLOYMENT. You have until the deadline for file claims for the plan year to actually database the claims, but any expenses incurred after you terminated will not be eligible for reimbursement.
If you've made an annual election of $1,000 to your FSA, the regulations unanimously make the entire $1,000 available to you instantly. If you leave your post before the shutting down of the year and haven't contributed the full amount, your employer "eats" the amount that you didn't contribute. That's a risk for your employer. The important piece to remember is that you can only directory claims for eligible expenses incurred during your employment. You won't be able to use it for any a moment ago incurred expenses once your employment terminates.
You can set up a unmarked FSA with your clean employer, if your new employer offer one.
This is not free money because when you filled out the FSA form you should hold had to enunciate how much will be deducted from your check to income it back. If you evacuate your job earlier it is paid for, they might hold any money that is coming to you within your final check.
You will be able to return with a new FSA surrounded by your new duty as long as it is offered, not all companies hold out this kind of benefit. When you do take it there will be a waiting interval before you can use this benefit within your new errand.
Good Luck
Actually, you can use the entire $1000 from your current job and get underway up another account at your brand new job as long as you don't exceed the $5000 boater for the year. Your current employer assumes the lose if you use more than you have accrue before you stop midstream. Likewise, if you are terminated and you haven't submitted claim forms for those amount at the date of termination you lose that money. Just make sure you submit adjectives claim forms and receive payment beforehand you leave your current profession. Some FSA vendors won't rate claims after you quit.