contributing to both a 401(k) and an ira

a financial question i had always wondered about was whether you could contribute to both an employer-sponsored 401(k) plan and an ira. the answer is yes, but the amount contributed to the ira is not deductible. (note that the limits on that page are out-of-date.)

but all is not lost: as long as you earn less than $95,000 ($150,000 if married filing jointly), you can contribute to a roth ira, in which the money is taxed now and tax-free at the time of withdrawal.

i was woefully slack in contributing to a retirement account between my time at knowledge adventure and when another 401(k) plan became available to me through my current employer. i'll be making up for that lost time for the next few years.

comments

Indeed.

I'm trying to sock away as much $$$ as possible for retirement. I just don't think that Social Security is going to help much. And I'd like to retire to a nice island somewhere.

Okay, maybe not. But still. I'd hate to be on a fixed income that doesn't allow me to do anything other than eat and watch TV all day.

» Jeremy Zawodny (link) » august 30, 2003 7:36pm

you could always leave this country - the way it's going, it'll probably be in the toilet anyway by then.

» arvind » august 30, 2003 8:39pm

As one of my associates keeps reminding me, unlike every other major monetary sink-hole in life (college, car, house, business, etc...) you can't borrow for your retirement.

When I started my current job, we had a pension plan that pushed the legal limits of company contributions: 25%. Now that we've grown into a full-fledged dev company (i.e. from 3 people to 9), we've lost that perk. :-(

» fritzkafka » august 30, 2003 11:02pm

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