Doing Our Future Selves a Favor

Well, I had a biopsy today because we found a lump. So maybe I’m not cancer free.  But, this lump didn’t change any of my financial plans.

Let’s talk for a few minutes about one of the greatest gifts you can give your future self: a retirement fund.

It’s tax season and people are just itching to use their refund on something: a new car, a night out, vacation, debt payments, maybe. Do you know what I did with my refund?  I opened up an IRA. Do you know what my Old Man did with his refund?  He put it in an IRA that I asked him to open last year.

**Disclaimer: My refund is usually small but this year for a variety of reasons, it was much larger than I anticipated.**

Did you know that adding money to a traditional IRA can give you a larger refund (this was one of my reasons)?  But just because you can get a bigger refund doesn’t mean a traditional IRA is the way to go.  A Roth IRA won’t get you a bigger refund, but you won’t have to pay taxes on it later when you do retire. I encourage you to look at some online calculators to decide which is better for you.

For 2015, you can still contribute up to $5,500 to any IRA. I know you may not have that money in the bank, which is why I encourage anyone who doesn’t need to pay off a debt with their refund to put the money in an IRA. I use Vanguard because of their low fees.

I also encourage everyone to adjust their withholding to get a smaller refund because you do more with that money in your pocket every month than you can by giving the government a 0% interest loan.

So do your future self  favor, use your refund to pay off a debt or save for your retirement account. You will appreciate it much more in the long run than a fancy television or vacation.

 

Advertisements

About His Polish Princess

I'm an engineer by day and an entrepreneur by night. I live with my Old Man, and our cat, Junior. Okay, so the cat is mine, not ours. I have some old fashioned opinions and I believe the unlikely can be achieved with hard work and a little bit of luck. I like cars and motorcycles and remodeling houses and taking risks. I love my family and my community in Small Town, USA. I believe life is one grand adventure that should be lived and thoroughly enjoyed. In 2013 I was diagnosed with an autoimmune disease and focused on natural healing. Fortunately, my disease has been in remission since 2014. In 2015 I was diagnosed with Hodgkin's Lymphoma. These things are just a road bump in life. They won't stop me from remodeling or buying houses or starting new ventures. Life is all about how you see it.
This entry was posted in retirement, Setting up for Success and tagged , , , , , . Bookmark the permalink.

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s