If you haven’t already made your IRA or Roth IRA contribution for 2012, don’t miss the deadline. Not contributing to an IRA every year could end up costing you in retirement!
You have until Monday, April 15, 2013 to make a contribution for your IRA or Roth IRA for 2012. Even if you don’t have an IRA yet, it’s not too late to open one and fund it for 2012. But hurry, once the deadline passes you will have not have any additional opportunities to make contributions for the year 2012!
How much can you contribute to an IRA? Well if you’re under 50 years old, you can contribute $5,000 for 2012, and $5,500 for 2013. If you’re over 50, you are allowed to make an extra $1,000 “catch-up” contribution each year (meaning those who are age 50 or over could contribute $6,000 for 2012 and $6,500 for 2013). The “catch-up” provision provides those who are closer to traditional retirement age to put away extra funds. In order to qualify, you must have reached age 50 by the end of the year in which the contribution is for. Here’s a chart to simplify:
|2012 Limit||2013 Limit|
|Under 50 years old||$5,000||$5,500|
|Over 50 years old||$6,000||$6,500|
To put money into a Roth IRA, you do have to be under a certain amount of income, but there are no income limitations on a traditional IRA other than that you (or your spouse) must have income from working. The difference between a Roth IRA and a Traditional IRA sounds like it should be the topic for another blog post, but if you have any questions in the meantime, please let us know!