At what age do you want to retire? This might be the most common question for almost every working individual. Sooner or later there comes a time when you need to take a break from your service life and step into your retired life.
A retired life can have two possibilities.
- A life full of pleasures, short vacations and following your hobbies
- A life where you don’t have sufficient savings to fulfill your dreams of a quality getaway or enjoying the small pleasures of life
Everyone wants a secured and a good retired life for which they also invest in retirement plans and schemes.
Some of the top retirement investment plans are:
- Roth IRA: The Roth IRA (Individual Retirement Account) is one of the most preferred plans under the category of top retirement investment plans. Roth IRA is a convenient way of investing tax-free savings for your retired life.
Paying tax is not a problem when you work and get a good salary, but it does become a big deal once you retire. So in order to get tax-free advantages, the Roth IRA becomes one of the most preferred top retirement investment plans for most of the retirees out there.
- Traditional IRA: Traditional IRA is a plan which enables you to contribute from the pre-taxed money. This makes your savings tax-deferred until you withdraw them after you retire. The earnings here are tax-deferred, which means that the retirees have to pay quite low taxes as compared to the tax they used to pay in their service life. The low tax rate in this plan makes it one of the top retirement investment plans.
- SEP IRA: The Simplified Insurance Pension Plan (SEP) IRA is one of the most convenient retirement plans for people who own small businesses with less number of employees or no employees altogether. It has a good contribution limit of $54,000 for 2017 set up by the IRS Government. Also, it is not necessary to pay the contributions every year. So if you had a good profit in the following year, you can contribute up to $54,000 and if you’ve had some great losses then you don’t have to pay the contributions for that year.