Roth Savings

Have a question about your personal investments? No matter how simple or complex, you can ask it here.
Post Reply
Topic Author
nick2302
Posts: 64
Joined: Sun Sep 25, 2016 11:29 am

Roth Savings

Post by nick2302 » Tue Nov 21, 2017 8:11 am

In reading another posting on this site I see someone saying their combined income is 400K and they save in a ROTH. My question is how can anyone earning 400K a year save in a ROTH? From what I read the rules for 2017 are

Direct Roth IRA contributions are only allowed if your income (technically your Modified Adjusted Gross Income) is below a certain level (you can get around this limit by using a Backdoor Roth IRA). For single filers in 2017, that income threshold starts at $118,000 (up from $117,000) and ends at $133,000 (up from $132,000). In that range, your contribution is limited, eventually reaching zero. For married filing jointly filers (and qualifying widower(er)s in 2017, that income threshold starts at $186,000 (up from $184,000) and ends at $196,000 (up from $194,000).

I would love to save in a ROTH but I am told I earn too much. How do others get around the rules for ROTH contributions? I earn no where near 400K more like 150K and am told I cannot save one dime in a ROTH as a single person with one earned income.

Thanks

user5027
Posts: 837
Joined: Sat Jun 16, 2012 8:54 pm

Re: Roth Savings

Post by user5027 » Tue Nov 21, 2017 8:19 am


NightFall
Posts: 267
Joined: Wed Mar 12, 2014 4:38 pm

Re: Roth Savings

Post by NightFall » Tue Nov 21, 2017 9:00 am

Some employers also allow for ROTH contributions from the employee, regardless of income level, into plans like 401k's, 403b's, or 457b's.

User avatar
TomatoTomahto
Posts: 9547
Joined: Mon Apr 11, 2011 1:48 pm

Re: Roth Savings

Post by TomatoTomahto » Tue Nov 21, 2017 9:16 am

@nick2302, yes, do the backdoor Roth for your non-employer provided savings. At your income level, I’d do Traditional for any employer-provided savings.

If you heard that Roth was unavailable to you from a CPA you employ, I’d consider getting a new one. There was a time, not that many years ago, where competent CPAs might not have heard of a backdoor Roth, but I think it should be known to them by now.
Okay, I get it; I won't be political or controversial. The Earth is flat.

Post Reply