Page 51 - Intelligent Investing (3)
P. 51
Types of Investment Accounts
● Roth 401k
○ After tax contributions + tax free distributions after 59 ½ yrs of age
○ Yearly contributions of up to $19,500 if under 50
○ Yearly contributions of up to $26,000 if 50 or up
● Traditional IRA
○ Usually offered by banks and investment companies
○ Banks only allow you invest in CD’s Certificate of Deposits or Money Market Accounts which
only hold cash, sometimes you can open an investment IRA
○ Pre tax contributions = taxed distributions
○ Contribute up to $5500 yearly if under 50 or $6500 if 50 +
○ Contributions may be tax deductible
● 401k
○ Retirement account by an employer (doesn’t include non profits)
○ Pre tax contributions up to $18,000 yearly or $24,000 if over the age of 50
○ Contributions are often matched by employer up to 10%
○ Distributions taken before 59 ½ will be taxed up to 30% and stock options are limited
